Retail sales edged higher in June, but the bigger story may be how Americans are changing the way they spend.
The government’s June retail sales report showed that retail sales increased 0.2%, indicating that consumers continue to spend despite higher prices and ongoing economic uncertainty.
On the surface, that sounds like encouraging news.
But I don’t think the 0.2% tells the whole story.
Retail sales measure how much consumers spend.
They don’t tell us why they’re spending—or how they’re paying for it.
Recent reports suggest that higher-income households continue to account for a significant share of consumer spending, while many other families have become more selective about discretionary purchases. At the same time, credit card balances remain elevated, suggesting that some households are continuing to spend by relying more on borrowing.
Neither of those trends tells the entire story.
👁️ Good Eye Mike’s Takeaway
In our house, Willie still gets his treats.
That hasn’t changed.
What has changed is how we think about everything else.
This week I bought a new lamp for my sports cave, but the rest of my shopping list can wait.
For Willie’s birthday, I decided to create a personalized birthday graphic instead of buying decorations and party supplies.
Before walking over to the food truck at Side Gate Brewery, I often check what’s already in the refrigerator.
I’m still spending money.
I’m simply thinking a little longer before I spend it.
I have a feeling many Americans are doing something similar.
Others may not have changed their spending habits much at all. Some households have higher incomes that allow them to continue spending comfortably. Others may be relying more on credit to maintain the lifestyle they’re accustomed to.
There isn’t one American consumer anymore.
There are millions of individual stories.
Perhaps that’s why a single retail sales number never tells the whole story.
It tells us what happened.
It doesn’t always tell us why.
Willie and I appreciate every reader.
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