Retail sales in September rose 1.3% from August and were up 12% year-over-year, according to the National Retail Federation.
Retail sales were among the first sectors to recover from the downturn thanks in part to around $3 trillion in government stimulus spending that included expanded unemployment benefits, which boosted consumption and savings despite mass layoffs. Apart from auto sales, retail sales rose by 1.5% last month.
"Nonstore retailers were up 23.8%from September 2019, while building material and garden equipment and supplies dealers were up 19.1% from a year ago". The July 2020 to August 2020 percent change was unrevised at up 0.6%.
And NRF pointed to September retail sales, which were paced by apparel, continuing a V-shaped recovery from the pandemic, with sales growing for the fourth consecutive month. "A significant number of people remain unemployed, but more are going back to work and that makes them confident about spending".
Kleinhenz noted that some of that money traditionally spent on such items as travel and entertainment has shifted to retail cash registers.
But those provisions have expired and lawmakers have been unable to agree for months on another measure that could restore the support, raising fears Americans wary of economic conditions will stop spending. Electronics and appliance stores were the only major segment to post a decline. "In theory both things should dampen growth". In practice, there is still momentum in the consumer economy for several reasons.
Consumer spending makes up two-thirds of all USA economic activity, and is watched closely to gauge the country's economic health.