Economy

US ecommerce sales rose in February despite 'headwinds'

A bevy of economic data released this week paints a picture for the second month of the year.

A rack holding coats.

Retail spending continues to climb.

Photo by Jordan Nix on Unsplash

Consumer spending, including in ecommerce sales, continued to grow in February despite continued inflation and supply chain issues.

That's the picture painted by a series of reports issued this week. Here's a look:

Consumer spending

US retail sales in February 2022 grew 8.7% over the same month last year, according to data from Mastercard SpendingPulse. That’s slightly above growth rates for January.

The gains reflected the return to more In-person activities following the omicron wave. This was evident in where they shopped, as in-person retail sales grew 10% year-over-year. It was also evident in what they bought, as top trends cited by Mastercard included return to office attire, which grew 37.6% year-over-year. Spending at restaurants increased 39.4% year-over-year, while luxury items, which are often purchased in-person, rose 55.4% year-over-year.

An indicator developed by Visa also showed consumer spending gaining. In February, the Visa U.S. Spending Momentum Index rose to 109.3, up from 102.4 in January. Spending by younger consumers far outpaced this group for most of the COVID-19 pandemic. With a 3.2% gap between cohorts, it is now approaching pre-pandemic levels.Visa developed this economic indicator using depersonalized transaction data to fill a gap to track ups and downs of consumer spending activity. When it rises above 100, consumer spending is strengthening. The fastest growth was among consumer ages 65 and older.

Ecommerce sales

In the US, digital commerce sales made by retailers in February grew 6% year-over-year, according to data released by Salesforce. In the same period, global digital commerce sales decreased 5% year-over-year.

There were continued signs of ecommerce sales slowing when compared to the early days of the pandemic. Mastercard writes that “the shift to digital remains a persistent yet slowing trend.”

'Persistent headwinds'

These figures arrived alongside news from the federal government that inflation reached a 40-year high in February. The Consumer Price Index rose 7.9% year-over-year in February, according to the U.S. Bureau of Labor Statistics. The closely-watched CPI

This extended to the realm of ecommerce. The Adobe Digital Price Index showed that inflation hit a record high of 3.6% in February, marking the 21st straight month of an increase.

Adobe said 13 of the 18 categories it tracks had increases in February, both when it comes to year-over-year and month-over-month comparisons. These categories included apparel (up 16.7% year-over-year), grocery (up 7.7% year-over-year) and tools (up 7.8% year-over-year).

At the same time, supply chain issues that are manifesting in crowded ports and product shortages continue. This resulted in a 1% decrease in product inventory in the US, and a 5% decrease in the same metric globally.

"Challenges that consumers experienced over the holidays, including inflation and low inventory, haven’t dissipated in the new year,” said Rob Garf, Salesforce VP and GM of Retail. “While digital commerce continues to prevail, it’s clear that inflation is having an impact on overall consumer spending. With these persistent headwinds, retailers must remove friction and enhance experiences by knitting together offline and online shopping.”

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