United States Retail Sales Register 0.9 Percent Growth in April

People walk through a mall in Manhattan in New York City on April 04, 2022. Spencer Platt/Getty Images

U.S. retail and food services sales rose in April 2022 by 0.9 percent on a month-on-month basis and by 8.2 percent when compared to April 2021, the latest data from the Commerce Department show.

“Total sales for February 2022 through April 2022 period were up 10.8 percent from the same period a year ago. The February 2022 to March 2022 percent change was revised from up 0.7 percent to up 1.4 percent.

“Retail trade sales were up 0.7 percent from March 2022, and up 6.7 percent above last year. Gasoline stations were up 36.9 percent from April 2021, while food services and drinking places were up 19.8 percent from last year,” said a May 17 press release (pdf).

Monthly retail sales for motor vehicles and parts dealers; home furnishing stores, electronic appliance stores; health and personal care; clothing; general merchandise stores; miscellaneous store retailers; nonstore retailers; and food services and drinking places registered positive growth.

In contrast, building material and garden equipment dealers; food and beverage stores; gasoline stations; sporting goods, hobby, musical instrument, and book stores all registered a monthly decline in sales for April.

According to Jeffrey Roach, chief economist at LPL Financial, April retail sales numbers are an indication that American consumers are “weathering inflationary headwinds,” according to CNBC. Core category numbers show signs that customers are “likely dipping into savings” in a bid to offset the decline in real wages.

Roach is expecting economic growth to rebound in this quarter if pricing pressures moderate to the extent that some of the pressure on customers are also eased. The April retail sales data is also being interpreted as dismissing a potential imminent recession.

“Given this show of strength from consumers, speculation that the U.S. economy is in danger of an imminent plunge into recession looks badly misplaced,” said Paul Ashworth, chief U.S. economist at Capital Economics in New York, according to Reuters.

Despite good numbers, inflation has been weighing down on customer spending. The April Consumer Price Index (CPI) was registered at 8.3 percent, just slightly below the 8.5 percent in March. With such elevated inflation, prices of goods and services remain high, forcing some to cut back on spending.

According to a survey conducted by American Consumer Credit Counseling (ACCC), 19 percent of respondents cut down their grocery budgets in the first quarter due to inflation.

More than 30 percent reduced fuel expenses while a third scaled down expenditure on entertainment. Almost half modified or postponed their travel plans.

“This surge in costs across just about every category of consumer goods is a significant burden on American households,” said Allen Amadin, president and CEO of ACCC.

“Discretionary spending is generally the first thing to be curbed during times of financial crisis.”

“When people are forced to buy fewer groceries or change their commuting habits, we have entered an entirely new level of challenge.”