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August retail rampant with rising consumer demand despite economic headwinds

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Retail is on a path heading just one-way; up.

Following supply chain issues in July which briefly stunted growth, the industry has bounced back in August with sales increasing due to consumer demand.

Matthew Shay, NRF President and CEO, commented: “The increase in August retail sales reflects the continued strength of the American consumer and the resilience of our nation’s retailers.”

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Adding: “In spite of the ongoing challenges of the global pandemic, concerns about the delta variant, and supply chain and workforce constraints, the retail industry continues to do what it does best – serve customers and support communities while keeping team members and associates safe and healthy. We maintain our confidence in the historic strength of consumers and fully expect a record year for retail sales and a strong holiday season for retailers.”

The U.S. Census Bureau today said overall retail sales in August were up 0.7% seasonally adjusted from July and up 15.1% year-over-year.

That compares with a decline of 1.8% month-over-month and an increase of 15.1% year-over-year in July.

Despite occasional month-over-month declines, sales have grown year-over-year every month since June 2020, according to Census data.

Jack Kleinhenz, the NRF’s chief economist, said: “Retail sales in August overcame unusual twists and turns that have affected shopping behavior both in terms of the timing and composition of sales.

“The consumer remains rock solid despite the trifecta of macroeconomic headwinds we’ve seen this year, including tapering off of government stimulus, elevated COVID-19 infections and ongoing supply chain challenges in the form of shortages of labor and goods. Higher sales came even with a disjointed back-to-school season that also affected the timing of sales as many school districts returned to in-person learning but some delayed classes until after Labor Day. These results pave the way for sturdy consumer spending and a strong economy in the fourth quarter.”

NRF’s calculation of retail sales – which excludes automobile dealers, gasoline stations and restaurants to focus on core retail – showed August was up 2.3% seasonally adjusted from July and up 12% unadjusted year-over-year.

That compared with a month-over-month decrease of 1.8% and a year-over-year increase of 8.9% in July. NRF’s numbers were up 11.4% unadjusted year-over-year on a three-month moving average.

For the first eight months of the year, sales as calculated by NRF were up 15 percent over the same period in 2020.

That is consistent with the NRF’s revised forecast that 2021 retail sales should grow between 10.5 and 13.5% over 2020 to between $4.44 trillion and $4.56 trillion.

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