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January Retail Sales Show Consumers Spending on Essentials: NRF

WASHINGTON, D.C. -- Retail sales last month indicated that consumers were focused on buying necessities more than discretionary items, the National Retail Federation said yesterday. The trade group said retail industry sales for January (excluding automobile, gas station, and restaurant sales) rose 2.0 percent unadjusted over last year, and 0.1 percent seasonally adjusted from December.

January retail sales released by the U.S. Commerce Department show total retail sales (which include non-general merchandise categories such as autos, gasoline stations, and restaurants) increased 0.3 percent seasonally adjusted from last month and 4.6 percent unadjusted year-over-year.

"The January numbers are indicative of the issues consumers are facing, including the housing slump, a sluggish employment sector, and high energy prices," said NRF chief economist Rosalind Wells in a statement. "We expect to see marginal improvements in the second half of the year once consumers begin to receive their rebate checks."

Separately, the Food Institute, based in Elmwood Park, N.J., reported that the nation's supermarkets rang up sales of $43.3 billion in January, up 6.3 percent from a year earlier, well above the 4.8 percent increase in overall retail sales.

According to a new National Retail Federation survey, conducted by BIGresearch, consumers plan to spend 40.6 percent of tax rebate checks when they are distributed later this year, which will provide an immediate $42.9 billion boost to the economy. The survey also found that the $105.7 billion distributed in tax rebates will be used to pay down debt ($30.0 billion), saved ($19.8 billion), invested ($4.4 billion), and used to pay down medical bills ($4.6 billion).
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