Retail sales rose 0.4 percent on the month in August, barely denting a slightly steeper revised 2.4 percent slump in July. Annual growth was minus 1.8 percent, up from minus 2.5 percent but below the market consensus and, apart from June, extending the unbroken run of negative prints that began back in October 2022.

August's monthly rise reflected a 0.8 percent increase in sales of food, drink and tobacco and 0.4 percent gain in non-food demand, excluding auto fuel. Auto fuel was down 1.7 percent.

Despite August's advance, average overall volumes in the last two months were still down 0.4 percent versus their mean level in the second quarter. Absent any revisions, September will need a monthly rise of at least a full percent if the retail sector is not to subtract from third quarter GDP growth. Today's update leaves both the Swiss RPI and RPI-P at minus 12, showing economic activity in general still falling slightly short of market expectations.

Sales are expected to fall 1.2 percent on the year after a 2.2 percent decline in July.

Retail sales measure the total receipts at stores that sell durable and nondurable goods. The survey comprises around 4,000 companies with the small-sized firms asked to provide monthly turnover data on a quarterly basis. Statistics are provided in both nominal and volume measures; the latter is the more important for financial markets. The headline figure is the annual growth in sales volumes adjusted for differences in trading days. Seasonally adjusted monthly changes are also provided. Details are limited in the first estimate but a more complete picture is provided with the following month's release.

Consumer spending accounts for a large portion of the economy, so if you know what consumers are up to, you will have a pretty good idea on where the economy is headed. Needless to say, that is a big advantage for investors. The pattern in consumer spending is often the foremost influence on stock and bond markets. For stocks, strong economic growth translates to healthy corporate profits and higher stock prices. For bonds, the focus is whether economic growth goes overboard and leads to inflation. Ideally, the economy walks that fine line between strong growth and excessive (inflationary) growth. Retail sales not only give you a sense of the big picture, but also the trends among different types of retailers. Perhaps auto sales are especially strong or apparel sales are showing exceptional weakness. These trends from the retail sales data can help you spot specific investment opportunities, without having to wait for a company's quarterly or annual report.