Retail Sales Research Brief

Elevated inflation and Fed response impact shopping. Overall retail sales were flat last month, against 0.4 percent headline CPI inflation, indicating that spending in real terms declined. Amid higher prices, steeper borrowing costs, and concerns over an impending economic slowdown, more households are further scrutinizing their spending. Consumers are placing a greater emphasis on necessities such as food, while holding off on larger discretionary items, in particular furniture and electronics. Having made ample purchases of these goods during lockdowns, many households are now focusing funds elsewhere. One sector where sales have kept ahead of climbing prices is at bars and restaurants, performance that brightens the outlook for single-tenant retail.