Americans are shelling out for higher gas prices while cutting back on some goods
CNN • • business
Key Points:
- US retail sales increased by 0.5% in April, marking the third consecutive monthly rise, though this was slightly below economists' expectations and down from March's 1.6% growth.
- Spending declined in categories such as furniture (-2%), car dealerships (-0.5%), department stores (-3.2%), and clothing shops (-1.5%), while gas station sales rose 2.8%, a sharp slowdown from March's 13.7% surge.
- Despite rising gasoline prices linked to the conflict in the Middle East, consumer demand remains resilient, supported by a low unemployment rate of 4.3% and strong job growth of 115,000 new positions in April.
- Consumer sentiment has dropped to record lows due to concerns over high prices, influencing spending habits and leading to reduced purchases of major goods like furniture and cars, with appliance demand reportedly at recession-level lows.
- Contrasting durable goods trends show new orders for computers and electronic products increased by 3.7% in March, contributing to an 11-month streak of growth in durable-goods orders.