Mixed Retail Sales Report, but Core Spending Remains Steady
Spending at bars and restaurants has propelled broader retail sales in recent years, but a retrenchment here in September along with smaller outlays at gas stations weighed on the headline, resulting in a 0.1% pickup.
Auto Sales Helped
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Prior to this morning's release we already knew that September was a good month for manufacturer sales of autos to dealers. The annualized pace of wholesale auto sales hit 17.4 million, which tied March for the fastest clip in 2018.
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Dealers were able to move inventory in September as well. Motor vehicle and parts sales jumped 0.8%. Perhaps not coincidentally, that too was the best month since March.
Core Spending Intact
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Bars and restaurants have been outperforming broader retail sales recently. But after four straight monthly gains, this category saw a 1.8% decline. The softness here combined with a 0.8% dip at gas stations help explain the headline miss.
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Excluding volatile categories like auto, gas and building materials, control group retail sales actually came in a little better than expected, up 0.5% in September.
Author
Wells Fargo Research Team
Wells Fargo
