Home Soft in Retail Sales in May
WASHINGTON-While overall retail sales increased last month, distribution channels selling home furnishings had a relatively weak May.
The furniture and home furnishings channel posted a drop of 0.8 percent in sales from April to May, along with a 0.5 percent decline from May 2012. Department stores (excluding leased departments) reported sales decreases of 0.2 percent month to month and 3.9 percent year to year. Sales at general merchandise stores increased 0.5 percent month over month and 1.1 percent year over year.
In total, U.S. retail sales were $421.1 billion on an adjusted basis in May, 0.6 percent ahead of April and 4.3 percent greater than May of last year.
The National Retail Federation attributed the increase in the total to improved consumer confidence and spending. "Stronger employment data and increasing home and equity prices lifted confidence and spending this spring," said Jack Kleinhenz, NRF's chief economist. Kleinhenz added that the economy appears to have "absorbed most of the blow" from the sequester and from tax increases earlier this year.
The housing rebound has bolstered consumer confidence by providing a "positive wealth effect" to consumers, according to Kathy Bostjancic, director of macroeconomic analysis for The Conference Board. "Thus, despite weak income gains, it is not surprising that consumer discretionary spending (after necessities have been accounted for) has held up moderately well," Bostjancic said.