WASHINGTON — U.S. shoppers retreated in August, cutting back their spending at auto dealers, furnishers and building material stores to depress overall retail sales after four straight monthly gains.
The Commerce Department said Thursday that retail sales fell 0.3 percent in August, a tentative sign of caution for American consumers.
Rising incomes and job growth have trickled into consumer spending, supporting economic growth even as a strong dollar and low energy prices have hurt the U.S. industrial sector. Over the first eight months of the year, retail sales rose 2.9 percent compared with the same period in 2015.
"The underlying fundamentals for the consumer remain quite strong," said Stephen Stanley, chief economist at Amherst Pierpont. "That makes August's clunker of a report a little hard to explain."
Stanley noted that the decline in retail sales might reflect some pre-presidential election doldrums and that sales reports in the next few months will be critical to monitor.
Still, consumers clearly appeared to pause in August. Spending on building material and furniture dipped, even though home sales have been solid in recent months. Auto dealers reported declining sales ahead of the new model year. Sales also fell at gas stations, largely reflecting lower oil prices. Even online and catalog sales, a sector that usually posts strong gains, slipped last month.
Not all categories declined. Back-to-school shopping appeared to bolster sales of clothing. And spending at restaurants and grocery stores also improved.
Read Friday's Arkansas Democrat-Gazette for full details.