October sales were up over the same period last year, but only slightly, signaling a slow-down in consumer spending just as the holiday shopping season begins, the National Retail Federation reported yesterday.
And in related news, audit firm Deloitte reported that its Leading Index of Consumer Spending rose this month rose slightly, indicating an iffy holiday shopping season.
“The index continues to show signs of volatility in 2007,” said Carl Steidtmann, chief economist with Deloitte Research and author of the monthly index, in a statement. “While home prices and gas prices continue to cloud the outlook, new home prices rebounded in September, the labor market showed modest signs of improvement, and the growth in the tax burden on households has slowed. We continue to believe that consumer spending over the next several months will reflect the current economic uncertainty. However, while the holiday season may not be as good as some hope, it does not look like it will be as bad as many have feared.”
Meanwhile, the NRF reported that retail sales for October — excluding so-called non-general merchandise categories, such as autos, gas stations and restaurants — rose 4.4% over last year and 0.1% seasonally adjusted over September.
According to the U.S. Commerce Department, October retail sales including the above-mentioned non-general merchandise categories increased 6.7% over the same period last year and 0.2% seasonally adjusted over last month.
“Gas prices and other economic issues are beginning to have an affect on consumer spending,” said NRF Chief Economist Rosalind Wells, in a statement. “While spending did increase in many important areas such as apparel and electronics, the consumer is showing caution while spending.”
An unseasonably warm October led to many leftover fall and winter apparel items at retail stores, according to the NRF. Sales at clothing and clothing accessory stores increased 0.1% seasonally adjusted from September but rose 4.9% unadjusted year-over-year, the NRF reported.
Sales at health and personal care stores increased 0.2% seasonally adjusted month-to-month and increased 5.9% unadjusted from last October, according to the NRF.
Also, building-material and garden-equipment stores sales showed slight increases in October, growing 0.6% seasonally adjusted month-to-month and 3.9% unadjusted year-over-year, the NRF reported. However, furniture and home furnishing stores sales suffered a 0.9% decrease seasonally adjusted from September and an 0.5% decrease unadjusted from last October, the NRF reported.
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