U.S. retail sales jumped higher last month, Commerce Department indicated Thursday, as tumbling gas prices gave consumers more cash to spend across different sectors of the economy, indicating that demand will continue to stoke inflation.
August retail sales rose 0.3% to a collective $683.3 billion, the Commerce Department said, well ahead of the Street consensus forecast of a 0.1% decline. The July total was unrevised from the original estimate of a flat month-on-month reading, the report indicated, although the core reading was clipped to a gain of 0.4%.
The advance was modest, however, compared to the broader level of price increases over the month of August, which were reported earlier this week. Core inflation, which strips out food and energy costs, rose 0.3% on the month and 6.3% on the year, while the headline reading was pegged at a faster-than-expected 8.3%. Year-on-year retail sales were up 9.1%.
Gas prices were a big component to the softer reading, as the national average cost for a gallon of gas was marked at around $2.84 per gallon in late August, down more than 25% from the all time highs it reached in early June.
Stripping out the auto sector, June retail sales were own 0.3%, the report noted, while stand-alone sales of gasoline fell 4.2% as prices retreated from the record high $5.017 per gallon hit during the month of June.
U.S. stock futures were little-changed following the data release, with contracts tied to the Dow Jones Industrial Average indicating a 35 point opening bell gain and those linked to the S&P 500 suggesting a modest 4 point move to the downside.
Benchmark 3-year Treasury note yields edged higher, to 3.831% following the data release while the dollar index was marked 0.1% higher on the session at 109.763 against a basket of six global currencies.
