U.S. retail sales exceeded expectations in November, highlighting consumers' continued resilience in spending as the holiday season began.

Retail and food services sales rose to $724.6 billion in November, a 0.7% increase from October, according to seasonally adjusted advance estimates released Tuesday.

The monthly growth outpaced market expectations of a 0.5% rise, based on consensus estimates from TradingEconomics.

Auto Sales Rocket

On a year-over-year basis, retail sales grew by a remarkable 3.8%, 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, holding steady from October but missing expectations of 0.4%. When stripping out gasoline, motor vehicles, and parts, sales also rose by 0.2% in November, steady from October and below the expected 0.4%.

Within spending categories, motor vehicle and parts recorded the largest monthly gain, with sales increasing 2.6% month-over-month and 6.5% year-over-year.

Other increases were found in nonstore retailers, up 1.8% month-over-month and sporting goods, hobby, musical instrument, and book stores, up 0.9% on the month.

On the other hand, miscellaneous store retailers registered the steepest monthly decline, with sales contracting 3.5%, followed by food services and drinking places, which saw sales fall 0.4%.

Market Reactions

The U.S. dollar index (DXY) which is tracked by the Invesco DB USD Index Bullish Fund ETF (NYSE:UUP) strengthened by 0.2%, following the data.

Treasury yields ticked higher, with the 10-year benchmark up by 2 basis points to 4.42%.

Futures on major U.S. equity indices edged lower in Tuesday's premarket trading, with S&P 500 contracts down 0.4% and the tech-heavy Nasdaq 100 slipping 0.5%.

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