Cash from the US government stimulus checks helped push U.S. retail sales up at twice the rate expected in May. A full percentage point gain in retail sales in May was reported by the US Commerce Department. Higher gasoline prices gave a lift to service station sales last month, but even with those stripped out, sales rose 0.8 percent, the biggest gain in a year. Consumers purchased clothing from sporting goods to electronics.

A wide variety of retailers enjoyed a good May, including the biggest increase at department stores and other general merchandise stores in a year. Discounters like Wal-Mart and Target, saw the largest increase in 14 months. People who could afford it bought electronics or clothes.

The May increase was double what economists had been expecting. This indicated that the economy is receiving a major boost from the $50 billion in economic stimulus payments the government sent out in May We do not accept what Ian Shepherdson, chief U.S. economist at High Frequency Economics said that consumers have returned to their free-spending ways despite weak consumer-confidence readings and the credit crunch.

Via our research in Customer Experience Measurement we are seeing cautious consumers who are shopping for value and believe it or not, a pleasant in-store and online shopping experience.

We favour what Nigel Gault, an economist at Global Insight, a forecasting firm said "The May retail sales report has dramatically changed the landscape,", wrote in a note. "Consumer spending has held up much better than gloomy sentiment surveys would suggest." Smart retailers take note!

As the attitudes of consumers toward value and spending change, we expect to see consumers looking for value to a much greater degree over the next six months.

Issues of greater competition for consumer dollars will move to the fore.

Retailers are far more concerned than ever, about understanding the reasons for buying with them versus the competition, with an eye toward tipping more of the balance in their favor.

Retailers are beginning to work harder to grab and keep every consumer dollar from competitors.

See: http://afp.google.com/article/ALeqM5iLEvyX9FwCjOgVTYPI8yvv3NwBKA for a complete report.