Consumers Show Surprising Resilience in July, but Outlook Still Murky According to NRF

Weary shoppers returned to the stores in July as retailers as were aggressively promoting back-to-school sales. Retail industry sales for July (which exclude automobiles, gas stations, and restaurants) increased 3.1 percent unadjusted year-over-year and also declined 0.2 percent seasonally adjusted month-to-month, according to the National Retail Federation.
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Washington – Weary shoppers returned to the stores in July as retailers as were aggressively promoting back-to-school sales. Retail industry sales for July (which exclude automobiles, gas stations, and restaurants) increased 3.1 percent unadjusted year-over-year and also declined 0.2 percent seasonally adjusted month-to-month, according to the National Retail Federation.

July retail sales released today by the U.S. Commerce Department show total retail sales (which include non-general merchandise categories such as autos, gasoline stations and restaurants) increased 0.4 percent seasonally adjusted from the previous month and increased 5.4 percent unadjusted year-over-year.

“Household spending remains tepid amid concerns about economic stability,” said NRF Chief Economist Jack Kleinhenz. “Current data on the economy is mixed which signals that retailers will continue planning with caution until a long-term trend can be established.”

NRF’s back-to-school survey, released in July, found that the average family of students in grades K-12 would spend 8.3 percent more on back-to-school this year, from $548.72 last year to $594.24 this year.

Back-to-school related categories saw strong year-over-year gains. Clothing and accessories stores were up a solid 4.7 percent over last July, while declining 0.7 percent from June. Electronics and appliance stores also showed strong year-over-year gains, increasing 8.1 percent and declining 0.1 percent from last month. Furniture and home furnishing stores ticked up 0.4 percent from the same period a year ago and declined 0.3 percent from the prior month. (All monthly sales are listed as seasonally adjusted, while year-over-year sales are listed as seasonally unadjusted.)

“Retailers are being very aggressive and clever with their back-to-school promotional strategies,” said NRF President and CEO Matthew Shay. “While we expect consumers to respond favorably to these promotions, sustained growth remains elusive as we look to the economy to add jobs to bolster consumer confidence.”

As the world's largest retail trade association and the voice of retail worldwide, the National Retail Federation's global membership includes retailers of all sizes, formats and channels of distribution as well as chain restaurants and industry partners from the U.S. and more than 45 countries abroad. In the U.S., NRF represents the breadth and diversity of an industry with more than 1.6 million American companies that employ nearly 25 million workers and generated 2009 sales of $2.3 trillion. www.nrf.com

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