Cars, electronics numbers not so hot
Sales of motor vehicles dropped last month and electronics numbers were also low. Alisa Roth reports retailers are cautious as spending slows, but things may pick up in August as students return to school.
SUVs and trucks sit on a lot waiting for buyers in Norwalk, Connecticut. Higher fuel prices have led to a steep decline in SUV sales across the country. (Spencer Platt/Getty Images)
More on The Economy, Auto Industry
TEXT OF STORY
Scott Jagow: With prices so high, people have really reigned in their spending. The government says retail sales fell in July -- that's the first drop since February. Alisa Roth tells us there's one thing in particular people aren't buying.
Alisa Roth: Vehicles. Sales of cars and parts dropped almost 2.5 percent last month.
Joel Naroff is chief economist for Commerce Bank:
Joel Naroff: Well, clearly consumers are being cautious, but the biggest problem is that they're not buying motor vehicles at all.
Not surprising, since gas prices were still around record highs last month.
Naroff: And as a result of that consumer spending is soft, but it's not terrible, and that's what seemed to come out of July's retail sales numbers.
There were decent gains in both furniture and electronics. Of course, numbers like these are notoriously volatile. Because in June, nobody was buying furniture or appliances.
Naroff thinks things could pick up slightly in August, with back to school sales and college students buying electronic gadgets. Slow spending by consumers means tough times for retailers. Naroff says stores are keeping smaller inventories and offering big discounts on the stuff they do have.
In New York, I'm Alisa Roth for Marketplace.
Comments
Comment | Refresh
Post a Comment: Please be civil, brief and relevant.
Email addresses are never displayed, but they are required to confirm your comments. All comments are moderated. Marketplace reserves the right to edit any comments on this site and to read them on the air if they are extra-interesting. Please read the Comment Guidelines before posting.
You must be 13 or over to submit information to American Public Media. The information entered into this form will not be used to send unsolicited email and will not be sold to a third party. For more information see Terms and Conditions and Privacy Policy.