The American consumer came back last month, with retail sales increasing 7.5 percent from May as stores reopened in warm weather, shoppers shook off lockdown fatigue and the federal government pumped trillions of dollars of stimulus into the economy. The jump, which sent spending back to just below where it was in February before the coronavirus pandemic sent the country into a tailspin, seemed to be cause for celebration after a record rebound in May.
“I feel like the consumers are just fed up,” said Andrew Moquin, who reopened his jewelry store outside Buffalo early last month. “They are moving on with their lives and they are saying, ‘I can’t solve these problems,’ whether it be Covid-19 or the divisiveness in the political arena. They want to be happy or they want their loved ones to be happy. You can only contract for so long before something expands.”
But the looming question is whether the robust recovery is sustainable. And there are already ominous signs throughout the broader economy that the rebound may fizzle, as stimulus money, unemployment benefits and tax refunds fade away and the virus continues to spread. On Thursday, new claims for state unemployment benefits exceeded one million for the 17th consecutive week and while the overall claims remained relatively flat, they rose in California, Florida and Georgia, where infections are climbing.