'Americans Bought Less But Paid More,' Says Peter Schiff: Experts Digest November Retail Sales Data

November's retail sales outpaced expectations, rising a 0.7% from October and outpacing market expectations of a 0.5% increase. Some experts are pointing out that inflation may be partially responsible for the increase in retail sales data.

Experts React: Retail sales grew by 3.8% year-over-year, the highest since December 2023, up from the upwardly revised 2.9% in October. Excluding motor vehicles and parts, retail sales advanced by 0.2% month-over-month, missing expectations of 0.4%.

Peter Schiff, chief economist and global strategist at Euro Pacific Asset Management, pointed to inflation and auto sales as the drivers of November's retail sales in a post on X.

"Nov. retail sales rose 0.7%, above the 0.5% that was expected. The rise resulted mainly from higher car prices, not higher car sales. If you strip out autos, retail sales rose just 0.2%, half of what was expected. If you adjust for inflation, Americans bought less but paid more," Schiff wrote.

Gregory Daco, chief economist at EY-Parthenon, Ernst & Young, also highlighted consumers' prudence in November's retail sales when adjusted for inflation.

🇺🇸 Prudent #retail sales outside of autos (Nov)

✅#Retail sales +0.7%
✅Adj for inflation +0.4%

✅Core 0.4%
✅Adj for infl 0.2%

🚗Auto 2.6%
💻Online 1.8%
⚽️Sport 0.9%
🏠Build mat 0.4%
🎮Elect 0.3%
🛋️Furn 0.3%
⛽️Gas 0.1%
⚕️Health 0%
🛒Food -0.2%
👗Cloth -0.2%
👩‍🍳Rest/bar -0.4% pic.twitter.com/uHOfEUCKXV
— Gregory Daco (@GregDaco) December 17, 2024

November's retail sales could have been bolstered by consumers who have reported buying big-ticket items in order to save money ahead of expected tariff increases under President-elect Donald Trump, according to Bloomberg.

"It's important to note that sentiment differs by political affiliation, with Democrats more concerned that proposed tariffs will drive a resurgence in inflation. As such, Democrats and independents have cited tariffs as a key driver of ‘buy-in-advance’ behavior, while Republicans broadly expect inflation to slow dramatically ahead," said Eliza Winger, Bloomberg economist.

On the other hand, Logan Mohtashami, lead analyst at HousingWire, pointed out that retail sales figures rarely go down and perhaps November's data should be expected.

It's uncommon to see negative nominal year-over-year retail sales data. Since 1993, the only instances were during Covid, the Great Financial Recession, and in October 2002. pic.twitter.com/cwMPrnmt1d
— Logan Mohtashami (@LoganMohtashami) December 17, 2024

Markets React: All major U.S. indices are trading lower Tuesday with the SPDR S&P 500 ETF Trust SPY, tracking the S&P 500, 0.56% lower at $603.42 and the Invesco QQQ Trust QQQ, tracking the Nasdaq 100 index, 0.75% lower at $534.15 at the time of publication.

Read Next: