NOVEMBER 20, 2023 — RETAIL SALES DECLINE FOR THE FIRST TIME SINCE MARCH
October retail sales fell for the first time since March, down 0.1 percent from September when sales rose 0.9 percent. The average gain during the last six months was 0.6 percent. The decline in consumer spending bodes well for inflation, reinforcing hopes for a soft landing.
Consumers are being affected by higher interest rates among other financial pressures. Consumers spent heavily during the summer on entertainment, travel and gasoline, which propelled the economy to a growth rate near 5 percent. Lately, consumer sentiment has fallen as the unemployment rate is slowly edging upward. Predictions are for a mere 1 percent growth rate in Q4.
The Fed has paused on raising interest rates, letting the previous increases work their way through the system before taking further action. The Fed has one last meeting scheduled on December 12-13, and unless something dramatic happens in the next couple of weeks, it is almost certain rates will hold steady into 2024.