US clothing retail sales rebound in April
Following on from a generally dismal first quarter for many US department stores and specialty apparel chains, cautiously upbeat reports last week suggested retail sales rebounded in April.
April retail sales rose 1.3% on the month before, the US Commerce Department said – the biggest rise since March 2015 – and were 3.0% higher than in April last year. Excluding the impact from cars, petrol and restaurants, core retail sales rose by 0.8%.
Sales at clothing and clothing accessories stores rose 1% month-on-month, and climbed 1.3% from April last year. This compares with a decline of 0.9% between February and March.
For general merchandise stores, sales were flat with March, and edged up 0.5% year-on-year, while department store sales rose 0.3% month-on-month, and declined 1.7% from the year before. Sales at sporting goods, hobby, book and music stores climbed 0.2% from the previous month, and jumped 4.2% year-on-year.
Neil Saunders, CEO at retail analyst Conlumino, says the sector was dragged down during the month by department stores, "a particularly challenged segment of the retail sector, and one with heavy exposure to apparel, which has struggled thanks to unseasonal weather."
He adds that the results suggest retail growth is now slowing, "but not dramatically and not in a way that is affecting all categories equally.
"Consumers are now more cautious about spending than they were at the start of the year. This is something not helped by the increase in the cost of gas which, although still lower than last year, has risen consistently for the past few months. Gas now takes a larger share of retail spend than at any time in the past 6 months.
Ultimately, this means that while Americans are still spending they are doing so more selectively: choosing which products to buy and which retailers to visit and paying much more attention to things like price and value for money. This is the type of environment where growth is not sufficient to keep all boats afloat."
His observations tally with a cautiously upbeat report on Friday (13 May) from the National Retail Federation (NRF), which suggests US retail sales in April – excluding automobiles, gasoline stations and restaurants – were 0.7% higher than in March. Overall US retail sales saw an increase of 1.3%, the best monthly gain in a year.
Year-on-year, April sales were 3.5% above the same month last year, and the three-month moving average was up 5.6% compared with a year ago, the NRF added.
However, sales at clothing stores edged up just 1% over March and were down 1.1% unadjusted over last year, while sales at general merchandise stores were flat with the previous month and increased a meagre 0.4% year-over-year.
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