Published on 23 Feb 2022 on Zacks via Yahoo Finance
Retail sales in the United States jumped 3.8% sequentially in January 2022, rebounding from an upwardly revised 2.5% drop in December, and much better than market forecast of a 2% rise. The reading marked the biggest increase in retail sales in 10 months, as consumers splurged on shopping despite rising COVID-19 cases and red-hot inflation. Year over year, retail sales grew 13% in January.
This means that mounting inflation is not bothering consumer spending as feared. According to the University of Michigan, consumer sentiment is at its lowest level since October 2011 due to soaring inflation. But a combination of rising employment, higher wages, and accumulated savings enable consumers to pay for those extra prices. Notably, household Saving Rate in the United States increased to 7.90% in December from 7.20% in November 2021.
Consumer spending makes up about 70% of U.S. economic activity. Thus, any massive jump in it will likely brighten the economic growth prospects. Below we highlight a few areas and the related ETFs that should stay afloat in the coming days.