Total retail sales increased 0.7% month-over-month in July (consensus 0.4%) following an upwardly revised 0.3% increase (from 0.2%) in June. Excluding autos, retail sales were up 1.0% month-over-month (consensus 0.4%) after increasing an unrevised 0.2% in June.
The results were powered by a big month of gains in nonstore retailer sales (+1.9%) and food services and drinking places (+1.4%).
The key takeaway from the report is that discretionary spending on goods remained healthy in July, providing another cue that the tight labor market continues to fend off a hard landing scenario for the U.S. economy.