Notice to UMB Cardholders Click here if you recently received a replacement card as a result of a potential compromise.

Consumer spending on the rise

Consumer spending growing in some industries, not others

Posted on 7/26/13 8:52:00 AM

It seems to be a mixed bag for U.S. consumer growth.

While Americans spent more at retail businesses in June, purchasing more cars and trucks, furniture and clothes, transactions slipped in other areas.

The Commerce Department recently stated that retail sales rose 0.4 percent from May to June, which was less than the 0.5 percent increase from April to May.
Total sales numbers in June were largely aided by the 1.8 percent increase in auto purchases, which was the biggest surge since November. Service stations saw an increase of 0.7 percent over this time as gas prices swelled.

But if you omit the automobile, gas and building supply industries, core retail sales escalated just 0.15 percent, the worst monthly increase since January.
Cash-strapped homeowners hoping to make a down payment on a car should look into a home equity line of credit, which allows qualified borrowers a line of cash to spend on home renovations, a down payment on a car or student loan repayment, among others. In order to qualify for a home equity line of credit, a borrower must put their home up for collateral to the lending bank or financial institution.

Over the past year, the sales of cars and trucks have risen 11.4 percent, according to data from the government. Sales in the industry struck 7.8 million units from January through June, which is the best first half since 2007.

Mike Jackson, the chief executive of AutoNation, said there seems to be "more potential on the upside" for the nation's automobile demand as gasoline prices and short term interest rates remain steady.

Less time shopping
Economists and industry experts are constantly scanning core sales because its factors are used to formulate the overall economic growth.

Other than auto sales, numbers aren't very optimistic, as U.S.  consumers spent less at restaurants and department stores in June. Fewer computers and electronics were purchased, and retail sales at home improvement stores, like Home Depot and Lowe's, dipped 2.2 percent from May to June. That field, though, has seen a nearly 10 percent increase over the past year.

"It is disconcerting that retail sales growth lost more momentum as the second quarter progressed," said Paul Dales, senior U.S. economist at Capital Economics.