U.S. shoppers did not open their wallets as much as expected in September amid rising prices and increasing fears of a recession.
Retail and food services were unchanged month over month, according to U.S. Census Bureau data released Oct. 14. Economists expected the figure to rise 0.2%, according to the consensus estimate compiled by Econoday.
Retail sales
U.S. retail and food services sales reached $684.0 billion in September, according to the seasonally adjusted Census Bureau preliminary estimate, the same total for August's revised figure.
Electronics and appliance stores posted a 0.8% sales decline in September and had the only annual decline at 8.6%. Sales at furniture and home furnishing stores dipped 0.7% for the month.
The largest monthly gains in September came at general merchandise stores, which rose 0.7%. Nonstore retailers — e-commerce, mail-order shops, vending machine operators and other direct sellers — had the biggest annual increase at 11.6%.
The sales figures are not adjusted for inflation. The consumer price index rose 0.4% in September from the previous month and 8.2% over the last 12 months.
Sales at general merchandise stores and nonstore retailers likely grew even when adjusting for inflation given that prices have not risen as much in these categories as others, said Michael Zdinak, an S&P Global Market Intelligence U.S. economist, in an email. Falling gasoline prices in September likely contributed to a monthly decline in fuel sales, while higher food prices boosted grocery sales during the month.
Default risk
The median probability of default score for all publicly traded U.S. retailers as of Oct. 12 was 4.6%, up slightly from 4.3% as of Sept. 13.
Internet and direct marketing retailers again had the highest median market signal one-year probability of default of any sector, at 8.9%, according to Market Intelligence data. The score, which represents the odds of default within a year, is based mainly on the volatility of share prices for public companies and accounts for country- and industry-related risks.
Bankruptcies
There have been 15 retail bankruptcy filings in 2022 as of Oct. 13, according to Market Intelligence data, the fewest number of filings in comparable periods since at least 2010.
