U.S. consumers are spending more in the second quarter of the year, even with the rising cost of living.
US retail sales rose 0.6 percent in June to a seasonally adjusted $456.98 billion, according to the Commerce Department.
Retail sales excluding automobiles and gasoline climbed 0.7 percent. Year-on-year, retail sales rose 2.7 percent in June, up from 2.2 percent recorded in May.
A healthy labor market couple with improving wages are fueling US domestic spending. Consumers have proven to be key to US economic growth in 2016, and has helped offset deficit created by global risks.
“This ends up capping a really great quarter for consumer spending,” said Omair Sharif, a senior U.S. economist at Societe Generale in New York. “There’s a bit more confidence about job security, there’s a bit more confidence about where things are headed in terms of wages and the economy. All of that is combining to give us the rebound we’re seeing in retail sales.”
Online shopping is gradually gaining attention as American shoppers have continued to shift their spending from the usual brick-and-mortar retailers to online shopping. Online sales rose 10.6 percent in the first half of the year, while department stores plunged 3.8 percent over the same period.
