What retail apocalypse? Almost three years after experts diagnosed the imminent demise of retail, the industry isn't dead yet. It's getting better.
On July 16, the Commerce Department data showed that U.S. retail sales exceeded forecasts in June for a second straight month, as states reopened and expanded jobless benefits stimulated consumers to spend. Retail purchases increased 7.5 percent from the previous month after a record 18.2 percent surge in May. What's more, clothing and clothing accessories sales rose 105.1 percent over the previous month.
But as COVID-19 cases spike around the country, forcing states that reopened too soon to contemplate shutting down businesses again, and jobless claims continuing to rise to levels higher than previously projected, analysts are warning that the unexpected exuberance may be short-lived. "Retail sales are now back to their pre-coronavirus levels,” Oxford Economics’ Lydia Boussour and Gregory Daco told Bloomberg News. “But while today’s report gives the illusion of a fearless consumer spending lavishly, the reality is more sobering: consumers are increasingly fearful amid new spikes in Covid-19 cases and a looming fiscal cliff.”
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