US Markets
Monday, November 13th, 2023 5:43 pm EDT
Key Points
- Consumer Spending Decline in October: The article highlights a decline in consumer spending ahead of the holiday season in October. Retail sales, excluding autos and gas, fell by 0.08%, and core retail, which excludes restaurants, saw a decline of 0.03%. These findings suggest a notable slowdown in consumer activity during this period.
- Introduction of CNBC/NRF Retail Monitor: The CNBC/NRF Retail Monitor, launched as a joint effort between CNBC and the National Retail Federation, is introduced in the article. This monitoring tool is based on data from Affinity Solutions, a major consumer purchase insights company. It distinguishes itself from the Census Bureau’s retail sales report by relying on actual consumer purchases rather than survey data. The Retail Monitor uses data from over 9 billion annual credit and debit card transactions, totaling more than $500 billion in sales and involving over 1,400 financial institutions.
- Insights into Consumer Behavior and Industry Performance: The article emphasizes that the Retail Monitor aims to modernize how retail sales are tracked and measured. Matthew Shay, the President and CEO of NRF, notes that the vast dataset provided by Affinity Solutions will help identify key demographics and channel performance for the retail industry overall and specific sectors. This tool is expected to offer dynamic insights beyond headline numbers, providing a detailed understanding of emerging trends. The data points to weaknesses in gas station sales, electronics, and furniture, while sporting goods, hobby stores, non-store retailers (such as internet sales), and health and personal care demonstrated strength. Additionally, the Retail Monitor is set to provide demographic breakdowns of spending by age, income, and geography in the coming months, enhancing its utility for investors, executives, and industry stakeholders.
The latest CNBC/NRF Retail Monitor, a collaborative effort between CNBC and the National Retail Federation (NRF), provides a fresh perspective on consumer spending ahead of the holiday season. Utilizing data from Affinity Solutions, a prominent consumer purchase insights company, the Retail Monitor is distinct from the Census Bureau’s retail sales report, relying on actual credit and debit card transactions rather than survey data.
In October, retail sales, excluding autos and gas, experienced a 0.08% decline, while core retail, which excludes restaurants, saw a 0.03% decrease. The data, sourced from over 9 billion annual credit and debit card transactions, paints a nuanced picture of consumer behavior, reflecting a spending slowdown.
The Retail Monitor’s methodology offers a real-time view of consumer activities without the need for subsequent revisions, in contrast to the Census Bureau’s approach. Affinity Solutions anonymizes and aggregates data from more than 1,400 financial institutions, covering over $500 billion in sales, providing a robust foundation for insights.
Despite a year-over-year increase of 2.6% in both overall retail and core retail sales, the October data highlights weaknesses in gas station sales, electronics, appliances, and furniture and home stores. Conversely, sporting goods, hobby stores, non-store retailers (e.g., internet sales), and health and personal care exhibited strength.
NRF President and CEO Matthew Shay emphasized that the Retail Monitor will modernize retail sales tracking, offering dynamic insights beyond headline numbers. CNBC Senior Vice President of Business News Dan Colarusso echoed this sentiment, emphasizing the tool’s ability to provide critical details and emerging trends.
The October findings align with Wall Street forecasts, signaling a cooling of consumer spending. As economists increasingly turn to real-time and high-frequency private sector data, the Retail Monitor emerges as a pivotal source, offering a comprehensive and up-to-date understanding of the economy.
The data also reflects the broader trend in the post-pandemic era, where reliance on actual, high-frequency, and private sector data has grown. Affinity Solutions founder and CEO Jonathan Silver sees the Retail Monitor as a herald of a new era in retail intelligence, transforming data into a roadmap for understanding and engaging with the modern consumer. The tool is expected to provide further insights in the coming months, offering demographic breakdowns of spending by age, income, and geography, enhancing its utility for investors, executives, and industry stakeholders.
For the full original article on CNBC, please click here: https://www.cnbc.com/2023/11/13/consumer-spending-fell-in-october-according-to-new-cnbc/nrf-retail-monitor-tracking-card-transactions.html
