Retail sales saw a surprising surge in August, despite fears escalating Covid cases and supply chain problems would hold consumers back, the Census Bureau reported Thursday.
Sales rose 0.7% for the month versus the Dow Jones estimate of 0.8%.
A separate economic report showed that weekly jobless claims rose to 332,000 for the week ending September 11, according to the Department of Labor. The Dow Jones estimate was 320,000.
Economists had expected consumers to scale back their activities as the Delta variant continues to rip through the US. Persistent bottlenecks in the supply chain should also hold back spending as goods in demand were difficult to find.
The impact of the pandemic was evident in bar and restaurant sales, which were unchanged for the month but still 31.9% above last year’s levels.
However, sales were strong in most areas during the month as back-to-school purchases generally spur activity, especially this year as schools prepare to welcome students back after a year of distance learning.
Headline numbers would have been even better without a 3.6% monthly decrease in auto-related activity; excluding the sector, sales rose by 1.8%, also well above the expected plus of 0.1%.
As fears about the pandemic increased, shoppers turned to the internet, with off-store sales increasing 5.3%. Furniture and home textiles also increased by a strong 3.7%, while sales of general merchandise increased by 3.5%.
Electronics and home appliance stores were down 3.1%, while sporting goods and music stores were down 2.7%.
Overall, the numbers reflect a more resilient consumer, with sales up 15.1% over the same period last year.
The positive surprise in retail was somewhat mitigated by a disappointing reading of the jobless claims.
Initial filings were up 20,000 from a week ago after a new pandemic-era low was reported. Still, the four-week moving average that makes up weekly volatility fell to 335,750, a drop of 4,250, bringing the number to its lowest level since March 14, 2020, when the pandemic began.
The loss amount was heavily seasonally adjusted, as the unadjusted number of registrations fell by 23,331 to 262,619.
Current receivables also fell, falling by 187,000 to 2.66 million, also a new low since Covid. The four-week moving average dropped to about 2.81 million.
However, those who received compensation under all programs rose just before the federal increased unemployment benefits ran out. This sum increased on August 28th and thus by 178,937 to 12.1 million before it expired.
In a separate economic report, the Philadelphia Federal Reserve reported that its manufacturing activity index rose 11 points to 30.7, the percentage difference between firms reporting expanding activity versus those reporting contraction. That number was well above the Dow Jones estimate of 18.7.
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