Retail Sales & Consumer Spending Forecast

Economic Forecasts

Car and Truck Spending Boost August Sales

Kiplinger’s latest forecast on retail sales and consumer spending


GDP 2019 growth will be 2.3%; 1.8% in 2020 More »
Jobs Job gains of about 170,000 per month in ’19 More »
Interest rates 10-year T-notes staying around 2% until trade war ends More »
Inflation 2.1% in ’19, up from 1.9% in ’18 More »
Business spending Up just 2% in ’19 amid uncertainty of trade war More »
Energy Crude trading from $50 to $55 per barrel in December More »
Housing 3.5% price growth by year-end ’19 More »
Retail sales Growing 4.3% in ’19 (excluding gas and autos) More »
Trade deficit Widening 7%-8% in ’19 More »

Purchases of cars and trucks surged in August, causing total retail spending to rise a solid 0.4%. Excluding cars and trucks and gasoline, sales were up a much weaker 0.1%. But that followed a strong gain of 0.9% in July because of Amazon Prime Day and similar sales from Amazon competitors, both in stores and online.

Although store sales were flat in August following the July bump, e-commerce sales kept powering ahead, with a fourth straight month of roughly 2% gains. E-commerce is on track to grow 17% this year, compared with only 2% for in-store sales. This would be the 10th straight year of double-digit increases.

Solid wage growth and low unemployment should mean good retail sales for the rest of this year. We expect sales, excluding gasoline and autos, to increase 4.3%, slightly behind 2018’s 4.7% pace.

Restaurant sales took a tumble in August. The cause of the drop is uncertain, but note that August was a down month for the stock market. And over the past year, restaurant sales have roughly mirrored the stock market’s performance. The market has risen 20% in 2019 and has likely contributed to consumers’ willingness to eat out. Expect total 2019 restaurant sales growth to come in at 4%, down a bit from 2018’s strong 6.3%.

Sales of building materials are finally picking up, and should grow 1.5% for the year as a whole.

Source: Department of Energy, Price Statistics