Economy Watch: Retail Sales, Gas Prices
- Aug 14, 2014
In July, American consumers took a break from an increase in retail spending. The Census Bureau said on Wednesday the retail and food services sales were $439.8 billion for the month, essentially unchanged when compared with June. Compared with July 2013, however, sales were up 3.7 percent.
The tabulations are adjusted for seasonal variation and holiday and trading-day differences, but not for price changes, according to the bureau. Take cars and car parts out of the equation, and sales inched up by 0.1 percent, since sales in that retail category actually dropped 0.2 percent in July. That’s unusual since Americans have been on a car-buying binge for some time now. Compared with July 2013, car and car parts sales are up 6 percent in July.
Most retail categories barely moved up or down for the month. Clothing and accessories, along with health and personal care, eked out 0.4 percent gains for the month, which was large compared with most other categories. Department stores lost 0.7 percent in sales for the month – they can seldom catch a break these days – and even Internet sales didn’t rise in July. Instead, online sales dropped 0.1 percent for the month.
Gas Prices Continue Dropping
The Energy Information Agency released its latest Short Term Energy Outlook on Wednesday, predicting–a little surprisingly, considering the recent tumult in various parts of the world, some of them energy-producing areas–that U.S. gas prices will continue to go down this year. Prices have already been dropping since mid-summer highs as international oil prices drop.
“The market’s perception of reduced risk to Iraqi oil exports and news regarding increasing Libyan oil exports contributed to a drop in the Brent crude oil spot price to an average of $107 per barrel in July, $5 per barrel lower than the June average,” EIA reported. It projects that Brent crude oil prices will average $107 per barrel over the second half of 2014 and $105 per barrel in 2015.
Regular gasoline retail prices fell to an average of $3.61 per gallon in July, 8 cents per gallon below the June average, according to the agency. It predicts that regular gasoline retail prices will continue to decline, to an average of $3.30 per gallon in December. EIA expects gasoline retail prices to average $3.50 per gallon in 2014 and $3.46 per gallon in 2015, compared with $3.51 per gallon in 2013.
Wall Street didn’t seem worried about retail sales or gas prices on Wednesday, with the Dow Jones Industrial Average gaining 91.26 points, or 0.55 percent. The S&P 500 was up 0.67 percent and the Nasdaq advanced 1.02 percent.