US retail sales higher than expected as oil prices stay up

Retail sales in the United States exceeded expectations in August, climbing by 1.2% month-over-month to a total of $773.9 billion, according to government data released on Wednesday. This figure surpassed the anticipated 0.8% growth that economists had predicted. The Commerce Department's advance estimate revealed that sales at gasoline stations increased by 3.1% compared to the previous month, marking a 21.0% rise compared to the same period last year.

The figures account for seasonal changes but not for price fluctuations, and the cost of gasoline has risen significantly since the United States and Israel launched strikes against Iran in late February, prompting Iran to block the Strait of Hormuz. This narrow waterway is crucial for the global flow of energy. Economists had forecasted a more modest 0.8% increase in retail sales for the month.

Notably, the national average price of gasoline in August remained above $4 per gallon throughout the entire month, setting a new record as the priciest August at the pump. When gasoline sales are omitted from the calculations, retail sales still grew by 1.1% in August compared to the previous month. Increased restaurant and bar sales also contributed to the overall sales growth.