What consumers do > what consumers say 🙊

Retail sales climb as sentiment deteriorates

Americans are shopping at a record rate. (Source: FRED)

🚨 NEWS: Consumers surprised economists. According to Census data released on Tuesday, retail sales were a record $638.2 billion in October, a 1.7% jump from September.¹

This reflected an acceleration from September’s 0.8% growth rate, and it was stronger than the more modest 1.4% growth rate expected by economists.

Electronics and appliance store sales jumped 3.8%. Building material and gardening equipment dealer sales grew 2.8%. Higher gasoline prices helped gas station sales rise 3.9%.²

This propensity to spend was echoed in Walmart and Home Depot’s quarterly earnings, which both companies announced Tuesday. Walmart said Q3 comparable store sales³ surged 9.2% from a year ago and are now 15.6% above 2019 levels.⁴ Home Depot’s comparable store sales jumped 6.1% from a year ago.

🤔 All these reports are particularly interesting when you consider that various sentiment surveys say Americans are depressed about the economy.

A Washington Post-ABC poll released on Sunday showed 70% of Americans rate the economy negatively. That’s a worse mark than last spring, when the U.S. was first confronting the pandemic. And the University of Michigan’s monthly consumer sentiment index released on Friday fell to its lowest level since November 2011.

Making sense of it all 🎈