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Retail sales were unchanged in April from March as inflation and interest rates curb spending

Posted 5/15/24

NEW YORK (AP) — Retail sales in April were unchanged from March as inflation continued to sting and elevated interest rates made taking on debt more burdensome.

The number following a revised …

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Retail sales were unchanged in April from March as inflation and interest rates curb spending

Posted

NEW YORK (AP) — Retail sales in April were unchanged from March as inflation continued to sting and elevated interest rates made taking on debt more burdensome.

The number following a revised 0.6% pace in March, according to Commerce Department data released Wednesday. It rose 0.9% in February. That comes after sales fell 1.1% in January, dragged down in part by inclement weather.

Excluding gas prices and auto sales, retail sales fell 0.1%

Online sales were down 1.2%, while business at electronics stores was up 1.5%. Sales at home furnishings stores slipped 0.5%.

The data offers only a partial look at consumer spending because it excludes things like travel and lodging. However at restaurants, the lone service category tracked in the monthly retail sales report, sales rose 0.2% from March.

There have been some hints that the Federal Reserve’s campaign to cool inflation by reining in spending may be taking hold. Employers pulled back on hiring in April adding 175,000 jobs, still a solid number, but down sharply from the surprisingly strong 315,000 hires in March.

Still, inflation remains a concern.

Consumer inflation in the United States cooled slightly last month after three elevated readings, likely offering a tentative sigh of relief for officials at the Federal Reserve as well as President Joe Biden’s re-election team.

Prices rose 0.3% from March to April, the Labor Department said Wednesday, down slightly from 0.4% the previous month. Measured year-over-year, inflation ticked down from 3.5% to 3.4%. And a measure of underlying inflation, which excludes volatile food and energy costs, also eased in April.

Inflation had been unexpectedly high in the first three months of this year after having steadily dropped in the second half of 2023. The elevated readings had dimmed hopes that the worst bout of inflation in four decades was being rapidly tamed. That has weighed on consumer confidence.

U.S. consumer sentiment fell in May to the lowest level in six months with the leading cause cited by Americans being inflation and interest rates, as well as rising anxiety about unemployment despite the very health job market.

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AP Economics Writer Christopher Rugaber in Washington contributed to this report.