Data released on Wednesday showed an increase in retail sales during August but below expectations: 0.6% versus 1.0%. Analysts at Wells Fargo point out that an important factor to consider is that August was the first post-pandemic month without the additional $600/week top-up from the federal government for unemployment benefits.

Key Quotes: 

“Retail sales rose 0.6%, but that fell short of consensus expectations for a 1.0% gain. The pandemic may not yet be in the rearview mirror, but with this fourth straight monthly increase, the level of retail sales rose to a fresh record high making it appear as though consumer spending has fully recovered.”

“Again Retail sales rose to a record high, although the increase was short of expectations and the details showed some payback for the high-flyers in prior months. E-commerce was flat, grocery stores and sporting goods fell.”

“The underlying details are less tidy, however, and a comparison of how retailers have fared by store type offers a snapshot of the unusual way U.S. households have spent their money in a summer that changed the face of retail.”