U.S. retail sales slowed in the last week of August, which is a sign that the slowdown for carriers may continue despite the Bush administration’s attempt to spark the economy with its $38 billion tax rebate. Retail sales fell 0.1% in the latest week, compared with a 0.1% rise one week earlier, according to the Bank of Tokyo-Mitsubishi UBS Warburg's (BTM/UBSW) retail chain store sales index.
Carriers are affected by a fall in retail sales because stores inventories decline more slowly, reducing demand for product deliveries.
The government began sending tax refund checks of $300 for individuals and up to $600 for families in July, and will continue to do so until the week of September 24. Analysts say consumer spending, which accounts for two-thirds of the economy, should accelerate with the refund checks, although it has yet to make a dent in the economy despite a 0.2% July rise in retail sales.
Neiman Marcus Group Inc. said last week that sales at its stores open at least a year fell 0.8% from a year ago in August, indicating that consumers bought fewer high-end goods.
Starbucks Corp. announced last week that same-store sales rose 1.0% in August, which ties its record for worst monthly performance since it went public. In its history as a public company, Starbucks had posted same-store growth of 1% only twice. The company has never reported a monthly decline in same-store sales, he said.
BTM said customer traffic in stores declined for the 18th consecutive week compared with the same time last year.
The BTM/UBSW Weekly Chain Store Sales Snapshot is compiled from the weekly reports of major discount, department and chain stores across the country.