Retail Sales Rise 0.8% in September, Exceeding Expectations
By TopHolding Editorial · Wednesday, October 14, 2026 at 8:00 PM
September retail sales increased by 0.8%, surpassing consensus forecasts, with upward revisions to previous months. While gasoline station sales significantly contributed to the headline figure due to higher prices, growth was broad-based across categories.
According to Brian S. Wesbury, Chief Economist at First Trust Portfolios, along with Nate Gerze, CFA, Economist, and Robert Stein, CFA, Deputy Chief Economist, retail sales saw an increase of 0.8% in September. This figure, which rises to 1.0% when accounting for revisions to prior months, considerably exceeded the consensus expectation of a 0.3% rise. Overall, retail sales have grown by 6.3% over the past year.
Excluding automotive sales, September's retail sales climbed by 0.9%, or 1.1% including revisions, once again outperforming the consensus forecast of 0.5%. These sales demonstrated a 7.2% year-over-year increase. The report indicates that the most significant gains in September were observed at gasoline stations and restaurant and bars, whereas miscellaneous store retailers experienced the largest decline.
First Trust's economists highlight that while the headline retail sales figure was "flashy," the details are more modest. Much of the unexpected increase stemmed from a 6.4% jump in gas station sales, which Wesbury and his colleagues note reflects elevated pump prices rather than a general boost in economic activity. Nevertheless, the commentary points out that growth was broad-based, with eight out of thirteen major sales categories showing increases in September.
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The economists at First Trust track "core" sales, which exclude volatile categories such as autos, building materials, and gas, as this measure is crucial for estimating GDP. This core measure advanced by 0.3% in September and grew at a solid 5.7% annual rate in the third quarter compared to the second-quarter average. This trend, they state, aligns with their forecast of real GDP growing at approximately a 3.0-3.5% annual rate in Q3. Within the core grouping, sales at nonstore retailers, which had been strong in recent months, slowed to a 0.3% increase in September after a 2.0% rise in August. Consumers reduced spending in certain areas, including sporting goods and hobbies (-0.5%), miscellaneous stores (-3.0%), and general merchandise stores (-0.1%). Meanwhile, sales at restaurants and bars, which offer a glimpse into the services sector in this report, rose by 1.1% in September, following an upwardly revised 1.4% gain in August. This category has seen consistent growth since February and is up 7.0% from a year ago, outperforming the 6.3% increase in overall sales.
The report reminds readers that these figures are not adjusted for inflation. While nominal retail sales increased by 6.3% over the past year, real inflation-adjusted sales were up by 2.5% during the same period. Despite higher prices inflating headline numbers, First Trust Portfolios' economics team observes that U.S. consumers continue to spend even in a challenging economic environment.
Key terms
1. Retail sales: A measure of the total receipts of retail stores and food services, providing an indicator of consumer spending.
2. Consensus expectation: The average forecast of a group of economists or analysts regarding a particular economic indicator.
3. Core sales: A measure of retail sales that excludes volatile categories such as auto sales, gasoline sales, and building materials to provide a more stable view of consumer spending.
Source: Nate Gerze, CFA, Economist; Brian S. Wesbury, Chief Economist; Robert Stein, CFA, Deputy Chief Economist, First Trust Portfolios — Data Watch. Read the original at ftportfolios.com.
