Data released on Friday showed a larger-than-expected rise in retail sales during June, but negative revisions to May’s figures. The conclusion of the June retail sales report is that while some demand clearly increased over the past year in categories such as sporting goods, building materials and garden supplies, the transition of consumers to spend more on services does not it must be accompanied by a sharp drop in the expenditure of goods, explained analysts of Wells Fargo.
“Retail sales increased 0.6% in June despite consensus expectations for a second consecutive monthly decline. In recent weeks, there have been many questions about whether the shift from spending on things to spending on experiences would cause an airlock in spending on goods. We have held the view that while services will be the main driver of consumer spending this year, spending on goods can still be sustained. Despite the surge in headlines, today’s report is not a complete vindication of our opinion on the matter. Some of the categories that drove the increase in post-pandemic spending last year were the same ones that saw declines this month. “