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Investing.com - U.S. retail spending excluding auto sales grew 1.9% year-over-year in August, accelerating from July’s 1.1% growth, according to Bank of America’s aggregated credit and debit card data.
Jewelry and beauty categories led the August growth, posting strong increases of 8.6% and 9% respectively. Clothing spending improved to 4.4% growth in August compared to 3.5% in July, suggesting robust back-to-school shopping despite concerns about a slowing consumer environment.
The data revealed a widening gap between income groups, with high-income households increasing clothing expenditures while low-income households reduced spending. Bank of America analysts suggested this divergence could indicate inflationary pressures affecting less affluent consumers.
Discount apparel spending accelerated to 1.3% growth in August from 0.8% in July, while department store spending further declined to -0.8% from -0.4% in the previous month. Bank of America remains positive on off-price retailers, anticipating consumers may trade down as prices increase to offset tariff impacts.
Specialty running retailers saw growth slow significantly to 0.3% in August from 3.8% in July, while direct-to-consumer footwear spending improved to -1.0% from -4.1%. Athletic footwear and apparel categories continued to struggle, with the decline worsening to -2.4% in August from -1.1% in July.
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