January Retail Sales See Biggest Jump in Nearly 2 Years
U.S. retail sales increased by 3 percent in January, far exceeding expectations for the month, according to the Commerce Department. This is the largest increase since March 2021. The Commerce Department said Wednesday it expected January sales numbers to rise 1.9 percent.
Food services and drinking establishments saw the biggest increase, at 7.2 percent. Motor vehicle sales and parts dealers saw a 5.9 percent increase, and furniture and home furnishing stores had a 4.4 percent increase in sales. Online retail sales rose 1.3 percent. Overall, January sales were up in all but one retail category on a yearly basis, according to the National Retail Federation (NRF).
"Retailers understand the needs of consumers and have in place the people, processes and technologies to meet consumers with the right inventory, competitive pricing and great experiences however consumers choose to shop," said NRF President and CEO Matthew Shay in a press release.
Total Retail's Take: The January sales increase shows that consumers are recovering from their holiday spending quicker than expected, and are continuing to be resilient in the face of inflation and economic uncertainty.
Kayla Bruun, an economic analyst at Morning Consult, said consumer finances are on slightly firmer footing to start the year.
"Today’s report suggests that goods categories will provide a boost to overall spending in the personal consumption expenditures release later this month, while Morning Consult’s data for January also showed expansion in services purchases," said Bruun. "Although resilient consumer spending is a positive sign for the health of the economy, renewed demand for supply-constrained categories could add to inflation pressures, potentially eliciting more aggressive action from the Fed."
