Consumers seem to be feeling the pain at the gasoline pump more than economists expected, according to the latest data on retail sales from the US Census Bureau.
Retail and food services sales for May, adjusted for a variety of factors, were $404.6 billion, a decrease of 0.2 percent from April. Spending is up about 5.3 percent compared to last May.
More than 11 percent of retail spending took place at gas stations in May.
Consumers spent about the same amount of money in grocery stores.
Compared to a year ago, food and gas sales are up about 3.3 percent.
Only automobile dealers and internet sales showed double digit growth when compared to a year ago.
Excluding auto sales, retail sales were off 0.4 percent. Robust spending on cars and trucks may be driven by necessity. The average age of the 240.5 million cars and light trucks being driven in the U.S. increased to 10.8 years in 2011, an all-time high, according to automotive market research firm R.L. Polk & Co.
As cars wear out, consumers have no choice but to replace their vehicle. Used cars may seem like a bargain to consumers after a 2.1 percent price drop over the past year.
According to the Manheim Index of used car prices, used vehicles are about 25 percent more expensive than they were in January 2009. Compact cars and pickups, the vehicles favored by middle class consumers, experienced the largest gains.
April retail sales were revised downward, showing that economists had been more hopeful than consumers once again. April sales were revised from a 0.1 percent gain to a 0.2 percent decline.
Consumer spending and the housing sector are usually considered to be critical to economic recovery.
Neither looks good at the moment.
© 2023 Newsmax Finance. All rights reserved.