Our Terms of Service and Privacy Policy have changed.

By continuing to use this site, you are agreeing to the new Privacy Policy and Terms of Service.

Retail sales rebound in July

By Annalyn Censky, staff reporter


NEW YORK (CNNMoney.com) -- After two months of declines, retail sales rebounded in July, the government said Friday.

Total retail sales rose 0.4% to $362.7 billion, compared with June's 0.3% decrease, the Commerce Department said. The June drop was revised from the originally reported 0.5%.

The overall sales percentage gain was slightly lower than anticipated. Economists surveyed by Briefing.com had expected sales would rise by 0.5% during the month.

Consumer spending accounts for two-thirds of U.S. economic activity, so retail sales and related reports are closely monitored to gauge the health of the economy.

Sales excluding autos and auto parts rose 0.2% last month, in line with economists' forecasts. In June, sales on the same basis were down 0.1%.

Motor vehicle and parts sales also rose 1.6% in the month, and gasoline store sales rose 2.3%.

As the recovery tugs along at a slower pace than most analysts had originally expected, consumers are still cautious about their spending. But July also marked the start of back-to-school shopping season, which often means a boost in sales.

"Back-to-school has accelerated into the July timeframe and we certainly know that parents are expecting to spend more than they did last year. The July numbers would indicate that that's going to be playing out through August as well," said Janet Hoffman, managing director of consultant firm Accenture's retail practice.

Overall, retail sales are up 5.5% over July last year, the government report said.

But the year-over-year comparison is not necessarily something to "jump for joy over," as retailers come off some deep hits last year during the downturn, said Doug Hart, a partner in the consumer product division of business services firm BDO.

On a month-to-month basis, sales are still showing relatively flat to modest gains in line with a slow recovery, he said.

"Consumers are still looking for value. They're still cautious," Hart said.

Analysts also often look to back-to-school season to forecast how retailers will fare during their most profitable season - the winter holidays.

Hoffman said she doesn't expect a "shocking uptick" in retail sales during the holidays, but is forecasting sales growth for that period. To top of page

Index Last Change % Change
Dow 17,851.51 145.46 0.82%
Nasdaq 4,894.89 33.83 0.70%
S&P 500 2,090.54 14.48 0.70%
Treasuries 1.87 0.01 0.59%
Data as of 4:47pm ET
Company Price Change % Change
Bank of America Corp... 14.92 0.24 1.63%
Chesapeake Energy Co... 4.35 0.30 7.41%
Freeport-McMoRan Inc... 11.65 0.54 4.86%
Hewlett Packard Ente... 17.35 1.10 6.77%
Apple Inc 99.62 1.72 1.76%
Data as of 4:15pm ET
Sponsors

Sections

Shari Redstone seems to be at the center of the turmoil engulfing Viacom and her father Sumner Redstone. More

Andrew Crider lost his welding business and his home when the real estate market crashed. Now the Nevada man is offended by comments Donald Trump made showing the billionaire rooted for the housing collapse. More

As the Verizon workers' strike continues to drag on, shares of the telecom giant have lagged the broader market -- as well as top competitors AT&T and Comcast. More