Retail sales were boosted by special deals and falling prices in July

The July Retail Sales report showed consumers continued to increase their spending during the month even as growth of the economy is moderating, noted National Retail Federation Chief Economist Jack Kleinhenz.

Retail sales topped expectations in July by rising 1.0% month-over-month to $709.7 billion. On a year-over-year comparison, retail sales rose 2.7%. Core retail sales were up 0.4% month-over-month vs. +0.1% consensus. Categories that showed strength included electronics & appliance stores (+1.6% M/M, +5.2% Y/Y) and health & personal care stores (+0.8% M/M, +3.4% Y/Y).

“July’s retail sale figures mirror the strength in the economy, which continues to expand even though there are pressures on growth,” highlighted Kleinhenz said. “The midsummer boost from back-to-school and college spending along with special deal days offered by retailers clearly helped. Households are proceeding with measured spending and getting the benefit of falling retail prices despite still-elevated prices for services,” he added.

Last week, the CNBC/NRF Retail Monitor, reported that core retail sales were up 0.95% seasonally adjusted month over month in July and up 1.69% year over year. That compared with increases of 0.3% month over month and 3.07% year over year in June. Unlike survey-based numbers collected by the Census Bureau, the Retail Monitor uses actual, anonymized credit and debit card purchase data compiled by Affinity Solutions and does not need to be revised monthly or annually.