NAFCU's Chief Economist Reports Retail Sales Stay "Flat" in July...

Curt Long

"Retail sales remained flat in July. That marks the slowest growth during any single month since December 2021. Much of the weakness was concentrated in autos and gas stations; excluding those categories, sales rose 0.7 percent on the month. The flat measure for spending coincides with July’s consumer price index (CPI) reading, which was also unchanged. That represents the third consecutive month that nominal retail sales growth has been at or below inflation, as measured by CPI. Supply issues persist, but the decline in real spending is fundamentally necessary to slowing down the overheated economy. That it has not yet resulted in a severe downturn in the labor market raises hopes that the Federal Reserve can achieve a soft landing. However, there is still lots of work to be done to get inflation near the Fed’s target, and financial conditions have eased recently. NAFCU still anticipates another 75-basis point increase in the target federal funds rate at the FOMC’s September meeting."
- NAFCU Chief Economist Curt Long.

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