By Selina Stoller, SAF Holdings, LLC
Damage from hurricanes, tropical storms, and a drop in consumer spending were the contributing factors behind the fall of U.S. retail sales in August.
The Federal Reserve reported that U.S. industrial production dropped a “seasonally adjusted” 0.9 percent in August from the prior month, its largest decline since the 2007-2009 recession.
The Federal Reserve stated that Hurricane Harvey was responsible for most of the decline by depressing oil drilling, petroleum refining, and other industrial activity.
The Commerce Department reported that spending at U.S. retailers fell 0.2 percent in August, and sales earlier in the summer were less strong than previously estimated.
Retail sales increased 0.3 percent in July, down from an originally reported 0.6 percent increase. Sales fell in June, compared with a prior estimate of an increase.
Gasoline sales rose 2.5 percent in August from the prior month, which reflected higher prices at the pump across the country, thanks to the wake of Hurricane Harvey across Texas refineries.
Sales were uneven across other spending categories as well. The sales increased at grocery stores and home furnishing stores but decreased at garden, department, and building-material stores. Sales at non-store retailers, like online-shopping outlets, fell 1.1 percent in August – the largest decline for that category since April 2014.
Weakness in online sales could be partly due to low inflation, as retailers lower prices, but struggle to drive traffic. The weak August reading also likely reflects some payback from Amazon Prime Day, which boosted online sales in July.
- 6 Oct, 2017
- Josh Smith