US retailers are on the rise
Retail sales unexpectedly increased in August. Analysts expected revenue stagnation.
Retail sales rose despite inflation concerns.
Photo: Patrick T. Fallon/Bloomberg
US retailers surprisingly increased sales in August. On Thursday, the Commerce Department said it was up 0.3% from the previous month. Economists polled by Reuters had expected revenue to stagnate. According to the revised data, there was a minus 0.4% in July. At first there was talk of stagnation.
“Retail sales rose despite inflation concerns, but the previous month’s numbers were revised down significantly. In addition, sales fell without the car component,” explained Helaba expert Ulrich Wortberg. High inflation reduces the purchasing power of American consumers. Inflation has fallen to 8.3% in August from 8.5% in July.However, experts expected a more significant slowdown in inflation, which far exceeded the Federal Reserve’s target of 2.0%.The Fed recently struggled with spiraling inflation by raising interest rates unusually.
In the US futures markets, the central bank is expected to follow through with a third key interest rate hike by 0.75 percentage point on September 21. This will raise the key interest rate to a range of 3.00 to 3.25%. A sharper increase of a full percentage point can also be envisaged. The Fed needs to ensure that high inflation is not permanent and detrimental to the long-term growth trajectory. “Short-term discouragement of economic development is necessary and will be accepted,” said Helaba Wortberg, economist.
Reuters
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