Retail sales up in September but a big chunk of spending went to an essential bill

Shoppers showed their willingness to spend in September even after a better-than-expected splurge in August.But a big chunk of their purchases last month went toward paying the bills at the gas pump, according to the Commerce Department’s latest snapshot on retail sales released Thursday.Retail sales increased 0.8% last month, after a revised 1.3% gain in August, the Commerce Department said.Economists were anticipating a 0.3% increase for the month, according to FactSet.Excluding business at gas stations, retail sales rose 0.2% in September.

The government figures aren’t adjusted for inflation, which accelerated last month as gasoline and many other goods and services became more expensive.In fact, business at gas stations rose 6.4%, according to the Commerce Department’s report.Elsewhere, business at furniture and home furnishings stores rose 1.3%, while electronics and appliance stores saw a 0.6% increase.Business at online retailers rose 0.3%, according to the report.

Clothing and accessories stores saw business unchanged from the previous month.The data offers only a snapshot of consumer spending and doesn’t include activities like travel and hotel stays.But the lone services category – restaurants – registered a solid 1.1% increase.“The large jump in headline retail sales in September was almost entirely due to rising gasoline prices,” Michael Pearce, chief U.S.

economist at Oxford Economics, wrote in a note.Pearce noted that consumer spending is still on track for a 3.3% annualized gain during the third quarter, but he expects spending to lose momentum heading into the key holiday shopping season as the drag from higher prices weighs more heavily on consumers.Many Americans have continued to spend despite skyrocketing gas prices that have accompanied renewed fighting in the Middle East.The average price for regular gasoline rose overnight to $4.33 per gallon Thursday, according to motor club AAA.Before the war began, the cost of gas per ga...