Interest Rate Hikes Put Brakes on Wild June Spending

Six Federal Reserve interest hikes framed June's “moderate” spending climate, says the National Retail Federation (NRF).

New sales figures from the Commerce Department indicate that sales figures rose 0.5 percent, seasonally adjusted from May and were up by 8.7 percent on a year-to-year basis.

Rosalind Wells, NRF's chief economist, points to several other factors influencing the underwhelming increase. Cooler than normal weather in much of the country drove down apparel spending and rising gasoline prices took a bite out of those discretionary dollars.

However, Wells believes that economic indicators remain positive and that sales will continue to rise for the balance of the year. “Although consumer spending appears to be slowing a bit, Wells says, “it's still growing at a healthy rate. Employment and income continue to grow and consumer confidence is still very high. There's nothing to suggest a significant downturn in the industry.”