US sporting goods sales buck flat retail sales in July
Statistics released by the US Department of Commerce last week show that sales of sporting goods were especially strong during July, despite flat retail sales overall during the month Job worries among US consumers meant retail activity remained in the doldrums for the second month in a row, with sales of automobiles and gasoline being especially hard hit.
Nevertheless sales of sporting goods, hobby shops and music stores were up 1.2% on June, with other big rises being noted in health and personal care products (up 1.7%) and clothes (up 0.9%). Sales at discount stores were also up at the expense of department stores such as Saks and apparel chains such as The Limited and Gap, where custom was notably down.
Released last week, the figures were slightly better than the overall 0.2% drop analysts were anticipating for the month. Nevertheless, continuing layoffs and stock market volatility meant shoppers remained reluctant to part with their cash. Even the mail out of tax rebates worth a total of $40 billion by the IRS during the month failed to make an appreciable difference.
With consumer spending now accounting for two-thirds of all economic activity in the US, economists are now worried that further job losses will drive down spending even more, sending the economy spiralling into recession. To avoid this, the Federal Reserve has slashed interest rates six times since the beginning of the year, totalling 2.75 percentage points.
