The U.S. Census Bureau reported on monthly sales for retail and food services for July 2023. The reports indicates that spending rose 0.7% from the previous month and 3.2% year over year.
July is the fourth month in a row that U.S consumer spending has continued to increase. Spending from May to June 2023 increased by about 0.3%.
In the Wall Street Journal’s coverage of the report, it noted that the growth is due to a strong labor market and a resilient economy “despite rate increases by the Federal Reserve.” Between employers adding more jobs and inflation slowly cooling, consumers have felt more at ease spending without fears of increased prices. The Journal also reports that the Fed will likely be deterred from raising interest rate further at its September meeting due to the slow and consistent growth.
“The Federal Reserve Bank of New York’s Survey of Consumer Expectations found perceptions about households’ current financial situations improved in July. The share of respondents expecting to be better off a year from now was the highest since September 2021,” according to the Journal.
CNN’s reporting on the Census report notes that sales from restaurants and bars rose 1.4% from June to July while sales of durable goods, like furniture and electronics, fell 1.8% and 1.3%, respectively. Also of note, gas prices were recorded at their highest since October 2022 at an average of $3.85, a month ahead of Labor Day, which would see millions of Americans on the road.