MasterCard today reported that US retail sales were up 8.8% y/y excluding autos.
January CPI numbers aren't out yet but the December reading was +6.5% so that's roughly 2.3% growth. Perhaps more notably, it shows a better pace than the December when sales were up 7.0% excluding autos. Again, January numbers aren't out yet so it might be seen as more of a preview of strong January spending.
One of the reasons for that could be that terrible weather around Boxing Day in much of the US pushed spending into the new year rather than diminishing it. Or it could simply be that the US consumer remains flush on pent-up pandemic savings.
To that point, restaurant spending was up 24.2% y/y while jewelery was up 6.5% y/y.
"The primary factor driving spending decisions is income – not just income today but the expectation for income tomorrow.” said Michelle Meyer, North America Chief Economist, Mastercard Economics Institute. “The strength in the labor market remains a critical support for consumer purchasing power and we’re seeing this reflected in our SpendingPulse insights for January.”
