Grocery Sales Moderate in June
Monthly grocery sales in the United States are settling in around $73 billion a month, new data from the U.S. Census Bureau indicates. According to the government’s advance sales data for June, grocery sales came in at $72.9 billion for that time span on an adjusted basis, slightly lower than the $73.4 billion for May and the $73.5 billion for April.
On a year-over-year (YoY) basis, sales were similar. The grocery sector rang up $72.5 billion in sales in June 2022. For the first half of 2023, purchases climbed 3.9% to reach $434.4 billion, according to the Census Bureau information.
[Read more: “Grocery Prices Unchanged in June”]
Even with a 0.7% dip in grocery sales in June, overall retail spending remains steady, reflecting consumers’ resilience in the face of recessionary speculation and still-elevated inflation. Census Bureau data revealed a 0.2% boost in general retail sales during June. For the first six months of 2023, retail sales are up 3.2% on a YoY basis.
Some analysts see encouraging signs in the new numbers, at least on a macro level. "June’s 0.2% gain in retail sales reflects positive momentum on inflation,” said Claire Tassin, retail and e-commerce analyst at Morning Consult. “Consumer concern about inflation hit its lowest point since Morning Consult began tracking last year: 47% of Americans said they’re very concerned about inflation, versus 64% a year ago.”
While price worries may be easing compared to this time last year, when the inflation rate was breaking decades-long records, consumers remain cautious and are wary of any additional hikes. In an earnings call last week, Conagra Brands CEO Sean Connolly underscored the mindfulness of today’s shoppers. “It’s not a trade down within individual categories to lower-priced alternatives. It looks, optically, more like a cutting back and what I call hunkering down. And one thing I know for sure, people aren’t eating less. So they’re making choices to manage their budget,” he pointed out.
In this fluid environment, the crystal ball remains cloudy. "The current picture on the consumer is a bit blurry," said Jeffery Roach, chief economist at LPL Financial told TheStreet. "It seems that excess savings buoyed retail activity in recent months but consumers are quickly depleting those excess reserves and starting to use credit to support spending habits."
David Russell, VP of market intelligence at TradeStation agreed. As he told the Reuters news service, "The economy is plodding along without overheating. Americans have gotten relief at the gas pump, but also don't have an excessive demand for consumer goods. This is modestly positive news for investors worried about the Fed needing to hike after July."
