Retail Sales
Retail sales measure the total receipts at stores selling merchandise and related services in the United States, published monthly by the Census Bureau as the primary gauge of consumer spending on goods.
The Monthly Retail Trade Survey, commonly referred to as the retail sales report, is released by the U.S. Census Bureau around the middle of each month covering the prior month's data. Because consumer spending accounts for approximately 70% of U.S. GDP, retail sales is one of the most important near-term gauges of economic momentum and is closely watched by the Federal Reserve, professional economists, and equity investors alike.
The report surveys roughly 5,500 retail and food service firms of varying sizes each month, collecting sales data across thirteen major categories: motor vehicles and parts, furniture, electronics, building materials, food and beverage stores, health and personal care, gas stations, clothing, sporting goods and hobbies, general merchandise, nonstore retailers (primarily e-commerce), food service and bars, and miscellaneous stores. Each category offers insight into specific consumer behaviors and industry trends.
Because gasoline prices can significantly distort the headline figure — a spike in fuel prices inflates the gas station component without reflecting genuine increase in purchasing volume — analysts often focus on retail sales excluding autos and gas, sometimes called 'core retail sales.' An even more refined measure called the 'control group' excludes autos, gas, building materials, and food services, and feeds directly into the BEA's calculation of GDP personal consumption expenditures.
The retail sales report captures spending on goods but not services such as healthcare, housing, haircuts, or financial advice, which means it understates the full picture of consumer expenditure. Nonetheless, it provides the most timely read on goods consumption available in the monthly data calendar.
Strong retail sales readings — especially in the control group — typically support positive GDP growth expectations, boosting equity markets and sometimes raising concerns about inflation if the economy appears to be running above capacity. Weak readings raise growth concerns and can accelerate expectations for Federal Reserve rate cuts.