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- I’m Surprised How Well Retail Sales Held Up despite Price Drops of Many Goods as Spending & Inflation Shifted to Services
I’m Surprised How Well Retail Sales Held Up despite Price Drops of Many Goods as Spending & Inflation Shifted to Services
by Wolf Richter Wolf Street
Dropping prices cause dollar-sales to drop even if unit sales rise. Home Depot today blamed part of its revenue decline on lower prices.
Total retail sales, seasonally adjusted, rose 0.4% in April from March, and 1.6% from a year ago, even though many of the categories of goods that retailers sell have dropped in price, some on a month-to-month basis, others already on a year-over-year basis, as inflation has shifted to services.
Gasoline prices have plunged by over 12% from a year ago, even as the price ticked up in April from March. Sales at gas stations have plunged in lockstep with the price of gasoline (green-red chart below).