Mastercard SpendingPulse: U.S. Retail Sales in June Reflect Rising Prices for Essentials, Continued Leisure Spending

Rhea-AI Summary

Mastercard SpendingPulse reported a 9.5% year-over-year increase in U.S. consumer retail spending for June, excluding automotive, with in-store spending rising 11.7%. E-commerce growth was slower at 1.1%, but sales are still double compared to June 2019. Inflation impacted spending patterns, with essentials like fuel and groceries seeing significant increases of 42.1% and 14%, respectively. Discretionary sectors like jewelry and travel also showed robust growth, indicating a varied impact of inflation on consumer behavior.

Positive

• Retail spending increased by 9.5% YOY, indicating strong consumer demand.
• In-store spending rose 11.7% YOY, suggesting recovery in physical retail channels.
• Discretionary spending in sectors like jewelry and travel saw significant growth.

Negative

• E-commerce growth slowed to 1.1% YOY, potentially indicating market saturation.
• High inflation rates may affect future consumer spending habits.

PURCHASE, N.Y.--(BUSINESS WIRE)-- According to Mastercard SpendingPulse^TM, which measures in-store and online retail sales across all forms of payment, U.S. consumer retail spending excluding automotive increased +9.5% year-over-year (YOY) in June, while retail sales excluding auto and gas rose +6.1% YOY. Rising prices—particularly for necessities such as food and fuel—were a contributing factor, as Mastercard SpendingPulse reflects nominal spending and is not adjusted for inflation. Excluding auto and gas, in-store spending is up +11.7% YOY in June, and while e-commerce grew at a slower pace this month (+1.1% YOY), sales for e-commerce remain roughly double June 2019 levels. Nominal spending growth is down slightly compared to May, though remains consistent with growth levels seen earlier in 2022.

(Photo: Business Wire)

As inflation persists, consumers are paying more for essentials. Two of the categories that have higher inflation have seen a lift in sales: June sales for Fuel & Convenience are up +42.1% YOY/ +55.7% YO3Y and Grocery +14% YOY/ +24.8% YO3Y.

Meanwhile, discretionary spending continued to drive growth across the fashion-forward sectors in June, including Jewelry +16.2% YOY/ +86.6% YO3Y, Luxury +4%/ +54% YO3Y and Department Stores +8.6% YOY/ +21.4% YO3Y. And with summer in full swing, consumers continue to spend on travel experiences: Airline and Lodging are both up +18.2% YOY/ +7.3% YO3Y and +33.7% YOY/ 30.4% YO3Y, respectively.

“Sector by sector, we’re seeing a varied picture of how inflation is impacting essential vs discretionary consumer spending,” said Steve Sadove, senior advisor for Mastercard and former CEO and Chairman of Saks Incorporated. “One notable highlight is that travel sectors such as airlines and lodging continue to show signs of strong demand.”

About Mastercard SpendingPulse
Mastercard SpendingPulse™ reports on national retail sales across all payment types in select markets around the world. The findings are based on aggregate sales activity in the Mastercard payments network, coupled with survey-based estimates for certain other payment forms, such as cash and check. As such, SpendingPulse™ insights do not in any way contain, reflect or relate to actual Mastercard operational or financial performance, or specific payment-card-issuer data.

Mastercard SpendingPulse defines “U.S. retail sales” as sales at retailers and food services merchants of all sizes. Sales activity within the services sector (for example, travel services such as airlines and lodging) are not included.

About Mastercard (NYSE: MA)
Mastercard is a global technology company in the payments industry. Our mission is to connect and power an inclusive, digital economy that benefits everyone, everywhere by making transactions safe, simple, smart and accessible. Using secure data and networks, partnerships and passion, our innovations and solutions help individuals, financial institutions, governments and businesses realize their greatest potential. Our decency quotient, or DQ, drives our culture and everything we do inside and outside of our company. With connections across more than 210 countries and territories, we are building a sustainable world that unlocks priceless possibilities for all.
www.mastercard.com

View source version on businesswire.com: https://www.businesswire.com/news/home/20220707005429/en/

William Tsang, Mastercard

+1 (914) 249-2640 | William.Tsang@mastercard.com

Source: Mastercard Investor Relations

FAQ

What was the year-over-year increase in U.S. retail spending reported by Mastercard in June 2023?

Mastercard reported a 9.5% year-over-year increase in U.S. retail spending for June 2023.

How did in-store and e-commerce spending perform in June according to Mastercard?

In-store spending increased by 11.7% YOY, while e-commerce spending grew at a slower pace of 1.1% YOY.

What impact did inflation have on retail sectors in June 2023?

Inflation led to significant increases in essential categories, such as fuel and groceries, while discretionary sectors maintained growth.

Which discretionary sectors showed growth in spending according to the Mastercard report?

Jewelry, luxury goods, and travel sectors like airlines and lodging showed notable growth in spending.

What trends were observed in consumer spending patterns in June 2023?

Positive trends included growth in discretionary spending and essentials, but e-commerce growth slowed.