Retail Sales Rise 1.1% in June

Consumers spent 1.1% more money on retail goods in June than in May, the Commerce Department said Friday, adding more evidence to the theory that households and consumer spending are sustaining the U.S. economic recovery.

Retail sales are a major indicator for the trucking industry, because much of trucking’s business comes from the delivery of goods to stores – if stores are selling more goods, then they need to place more delivery orders to replenish their supplies.

The 1.1% increase is lowered to 0.4% when automobile sales are excluded from the report.

Economists said that low interest rates, continued rising incomes and discount pricing by stores like Wal-Mart and companies like General Motors Corp. contributed significantly to the increase in sales, Bloomberg reported.

Gary Thayer, chief economist with A.G. Edwards & Sons Inc. in St. Louis, told Bloomberg that consumers are taking advantage of the fact that wages are rising faster than inflation – in essence increasing their purchasing power.

The increase in June sales, which pushed overall retail sales to $299.5 billion, followed a revised 1.1% dip in sales in May.

Bloomberg’s survey of economists before the release of the Commerce Department’s report showed a consensus estimate of a 0.7% increase in sales for the month.

The largest increase across a retail sector was in automobile sales, which rose 3.4% -- its biggest gain since October 2001. Sales at gasoline stations leveled off – dropping only 0.1% in June after a 2.4% drop in May.

Sales also increased at clothing stores, electronics and appliance outlets and building materials stores. General merchandise sales, including sales at department stores, increased 0.1% during June. Sales at home furnishings and furniture stores were unchanged.

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