October turned out to be a strong month for U.S. retailers as consumer spending increased, fueling sustained economic growth. According to the Department of Commerce, retail sales increased 0.4% from September, continuing the positive trend seen with the previous month’s 0.8% increase.
A 1.6% increase in auto sales led the gains, along with a 2.3% increase in electronics and appliance stores and a 0.7% increase in restaurant and bar sales. While some of the spending growth reflected higher prices, much of it indicated increased consumer purchases.
Some sectors, such as furniture, clothing and pharmacies, experienced declines that economists attribute in part to the impact of recent hurricanes. In contrast, home and garden stores saw growth, likely driven by rebuilding efforts after the storms.
Economists note that moderating inflation, which now stands at 2.6%, is allowing consumers to spend more freely. Wells Fargo’s Tim Quinlan noted that eating out remains a growing expense despite its cost, as spending at bars and restaurants outpaces price increases.
With the holiday shopping season approaching, analysts anticipate a solid performance, although high prices may temper last year’s enthusiasm. The retail sales figures highlight the resilience of the economy, which expanded at an annual rate of 2.8% last quarter and shows continued growth through the end of the year.