Much to the surprise of economists, Americans are still spending money despite high prices brought on by inflation.
According to U.S. Census Bureau data released Tuesday, U.S. retail and food services sales were above what analysts expected in September, hitting nearly $705 billion.
The rise in retail sales, up 0.7% from August, beat the 0.3% rise that economist had expected. It's also a 3.8% increase from last September.
"Total sales for the July 2023 through September 2023 period were up 3.1 percent from the same period a year ago," the Census Bureau added.
Economists were surprised to see how willing shoppers are to part with their cash, Gregory Daco, Ernst & Young chief economist, said on the "Bloomberg Surveillance" podcast.
"We are seeing that consumers spent more than we initially thought over the course of the summer," Daco said. "We've been surprised as to how resilient consumers are."
Sales at "miscellaneous store retailers" saw the biggest jump from August to September at 3%. That's followed by spending at "nonstore retailers," up by 1.1%, and sales at motor vehicle and parts dealers, which increased by 1%.
Sales at food services and drinking places, along with gas stations, both increased by 0.9% for the month. Grocery stores and general merchandise stores both saw a .04% increase in sales, while spending at health and personal care stores increased by .08%.
As for a drop in spending, clothing and accessories stores along with electronics and appliance stores both saw a 0.8% decrease in sales for the month. Spending was also down at building material/garden/supplies dealers by 0.2% from August.
Additionally, the data shows no increase or decrease in spending at furniture stores and sporting goods/hobby/musical instrument/book stores.