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Consumers Resilient Despite Higher Gas Prices
WASHINGTON -- Higher prices at the gasoline pump weren't enough to keep consumers away from the stores in May, according to the latest monthly index by the National Retail Federation. The trade group's retail sector performance index continued its strong showing in May with a reading of 59.6 points, up 12.1 points from a year ago and up 1.4 points from April (58.2). "It may cost more to drive to the stores, but consumers are still shopping," said Tracy Mullin, president and chief executive officer of the National Retail Federation. "Consumers have told us they would scale back some spending as gas prices increase, but the shift does not appear to be dramatic.The National Retail Federation's performance index measures executives' evaluations of monthly sales, customer traffic, average transaction per customer, employment, inventories and a six-month-ahead sales outlook expectation. The index is based on a scale from zero to 100 with 50 equaling normal.Retailers remained in the driver's seat in terms of pricing power in May, according to the trade group's pricing index, which set a new high. "As pricing power increases for retailers, we are seeing less reliance on deep discounts to drive sales," said Mullin. "This should result in a better profit picture for retailers in the months ahead."The positive retail outlook extends beyond the summer as the six-month outlook for retail also set a new high, the noted. The six-month outlook for sales posted its strongest reading (65.4) since the survey started in September 2002. The National Retail Federation is the world's largest retail trade association, and represents an industry with more than 1.4 million U.S. retail establishments, more than 20 million employees -- about one in five American workers -- and 2003 sales of $3.8 trillion. As the industry umbrella group, NRF also represents more than 100 state, national and international retail associations. Visit the National Retail Federation at www.nrf.com."