Recent data shows that U.S. sales rose in December over the holiday season by the most since July. Contributing factors included a rebound in auto purchases and increased holiday shopping.
Commerce Department data shows that the value of retail purchases, not adjusted for inflation, increased 0.6% after a downwardly revised 0.1% drop in October.
Excluding cars, data showed that sales overall increased by 0.5%.
According to the report, 10 out of 13 categories showed increases in sales, including sporting goods, hobby stores, building materials retailers, and clothing outlets. Motor vehicle sales also rebounded.
Spending at restaurants and bars increased by 0.6% after decreasing the month prior.
Sales at clothing and accessories stores increased by 0.9%, and online businesses saw a 0.4% increase in sales.
At sporting goods and hobby stores, sales increased by 1.9%. Furniture and home furnishing stores saw a 0.1% decrease, with consumer electronics and appliance stores observing no change in sales between November and October.
“Consumers are gloomy, but they are still spending. The only areas they are pulling back in are home improvement, home furnishings and some electronics and appliances. Outside of those areas, consumers continue to spend and they are likely to keep that up in early 2026 as they receive larger-than-normal tax refunds,” said Heather Long, chief economist at Navy Federal Credit Union, in a recent interview.
Consumer prices rose 0.3% in December from the month before, the same as in November.
The National Retail Federation predicts that retail sales in November and December grew between 3.7% and 4.2% over 2024, which translates to a range between $1.01 trillion and $1.02 trillion.
Holiday sales for 2024 rose by 4.3% over 2023 to reach $976.1 billion, according to data.
The historic 43-day federal government shutdown significantly delayed the publication of U.S. economic data, including retail sales.
