The consumer is and has been the driver of the U.S. economy for decades. What they do in an economy like ours is paramount. Their economic health is critical. How we determine their health is through the job report, consumer sentiment reports, and many other statistics released every month. However, what is most important? I would say the Retail Sales Report. It is not a leading economic indicator but clearly, it tells us what the consumer is doing with their money and that in turn is a gauge on the health of the economy.
For September, the consumer spent more money than the month before up 1.9%. More importantly, the level of spending equals the amount spent in February, before the coronavirus shutdown. At the core, level spending was up 1.5% up from the expected .3%. These are big numbers.
Expect less robust numbers for this month as the stimulus package that puts extra money in consumer’s pockets has run out, thus their spending will slow.