Retail sales in the United States fell 0.3 percent from August in the first decline since February providing more evidence that the U.S. economy could be slowing down, according to The Wall Street Journal.
Economists expected a 0.2 percent increase in total sales. The report suggests that consumer spending is skeptical amid concerns that trade tensions are weighing on the global economy. Consumer spending is the main driver of the U.S. economy and accounts for more than two-thirds of economic output.
The decrease in retail sales adds to the growing list of other data points that have signaled uncertainties regarding the future of the global economy. Furthermore, U.S. gross domestic product grew at a 1.4 seasonally adjusted annual pace in the third quarter, compared with a 2 percent annual rate in the second quarter and a 3.1 percent pace in the first quarter.
Retail sales tend to be volatile month to month, but the broader trend this year shows long term growth. Prices of goods have also increased as a result of the U.S. China trade war that has only recently shown signs of possibly concluding in the near future.
Trey Kraus, owner and president of Carlton’s Men’s and Women’s Apparel, said he raised prices on almost every item in his store due to the U.S. tariffs placed on Chinese imports. “Even though our business is up year over year, without the [price] increases, I would’ve anticipated five to 10% more in volume than what we are experiencing,” Mr. Kraus said and continued by saying that the increase in prices has deterred customers from purchasing multiple items at once.
Retail sales declined for the first time since February, but the broader trend shows long term growth.