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Consumers spent a bit more in August than the previous month, a sign the economy is holding up even as inflation lifts prices for food, rent, and other essentials, the Associated Press reported. Americans boosted their spending at stores and for services such as haircuts by 0.4% in August, after it fell 0.2% in July, the Commerce Department said Friday. Yet much of that increase reflected higher prices, with an inflation gauge closely monitored by the Federal Reserve rising 0.3% in August, the government’s report showed. The figures suggest that the economy is showing some resilience despite sharply rising interest rates, violent swings in the stock market, and high inflation. Still, there were signs that rising prices are weighing on shoppers. Consumer spending, adjusted for inflation, is growing at a weaker pace. It increased at an annual rate of 2% in the April-June quarter. Yet July and August data indicate that spending growth is on track to slow to an annual rate of just 0.5% in the July-September quarter, economists said.

A Manhattan deli known as the nation’s oldest cheese shop was forced to declare bankruptcy amid a lawsuit over the back rent it owes, the New York Times reported. Alleva Dairy in Little Italy filed for chapter 11 on Tuesday in the wake of the tourism-starved pandemic years, according to shop owner Karen King. “Today is one of the saddest days in the 130-year history of this illustrious Little Italy landmark,” King said in a statement after the filing. “We will continue to strive to keep Alleva Dairy alive.” The store, which first opened on Grand and Mulberry streets in 1892, is in jeopardy of closing due to $509,106 in rent it failed to pay during the pandemic, according to a lawsuit filed in April by its landlord.

States once flushed with revenue from surging sales tax collections are starting to see inflation-related declines, signaling state revenues may continue to drop, Bloomberg News reported. The number of states that saw year-over-year declines increased to 25 in June from 16 in May, according to the Urban Institute. That declining performance, which is analyzed over a three month rolling average, follows a strong first quarter for sales tax receipts in which nearly every state saw growth in real terms. While state coffers remain buoyed by high sales tax collections this year and record income tax receipts in 2021, changing consumer spending patterns and high prices have triggered a decline in revenues for one of states’ key funding sources at the same time as stock market volatility threatens income tax collections.

Some of the Revlon Inc. creditors who were accidentally sent more than $900 million by Citigroup Inc. asked a federal appeals court for a rehearing, after it ruled that they had to give the money back, Bloomberg News reported. The lenders — which include Brigade Capital Management LP, HPS Investment Partners LLC and Symphony Asset Management — asked the U.S. Court of Appeals for the Second Circuit on Thursday to have a larger group of judges review the decision by a three-judge panel this month. That decision reversed a lower-court ruling that they could keep $504 million the bank mistakenly wired them in 2020. Some of the lenders had given the money back. The panel’s decision, in a case that became the talk of Wall Street, was a redemptive win for Citigroup’s main banking unit in its efforts to redress the embarrassing blunder, which forced the bank to explain to regulators how such a failure was possible. The legal dispute turns on the “discharge for value” defense, established by a 1991 New York court ruling that creditors can keep money sent to them in error if they didn’t realize the payment was a mistake. The lenders said the appellate panel’s decision “unsettled previously established New York law, such that parties in financial transactions can only wonder whether the New York state courts will adopt this court’s newly crafted exceptions to the discharge-for-value rule.”

U.S. retail sales rose 0.3% last month after falling 0.4% in July, the Commerce Department said Thursday. Excluding business at gas stations, sales rose 0.8%, the Associated Press reported. The sales figures for August were largely boosted by higher spending on vehicles. Sales of purchases at motor vehicles and parts dealers rose 2.8% last month. Excluding vehicle sales, spending slipped 0.3%. Excluding both vehicle and gas spending, retail sales rose 0.3%. While the report showed shoppers’ resilience, the figures also are not adjusted for inflation unlike many other government reports. In fact, sales at grocery stores rose 0.5%, helped by rising prices in food. There was, however, weakening in some areas of discretionary spending with Americans fully aware of inflation’s bite. Business at restaurants ticked up 1.1%, but the pace has slowed. Sales at furniture stores fell 1.3%. Online sales fell 0.7% last month after Amazon’s Prime Day boosted e-commerce sales in July. Consumer spending accounts for nearly 70% of U.S. economic activity and Americans have remained mostly resilient even with inflation near four-decade highs. Yet surging prices for everything from mortgages to milk have upped the anxiety level. Overall spending has slowed and shifted increasingly toward necessities like food, while spending on electronics, furniture, new clothes and other non-necessities has faded.

Revlon Inc. received bankruptcy court approval to pay a total of between $14.5 million and $36 million in potential bonuses to eight insiders, MarketWatch.com reported. The beauty-products business, which sought protection from creditors in June, could make the variable payments over 18 months to keep the top senior executives on board as it reorganizes in chapter 11. The only party objecting to the compensation program was the Justice Department's bankruptcy watchdog, which questioned whether the financial targets were "layups." Judge David Jones ruled at a hearing yesterday in the U.S. Bankruptcy Court in New York that the goals are "tall orders" since Revlon must overcome supply-chain problems and must get its products on retail shelves in time for the holiday season. Rising interest rates are another challenge, he said. Judge Jones also said he was also reassured by the fact that Revlon's unsecured creditors committee also supports the incentive program.

Maine-based Olympia Sports Acquisitions, LLC filed for chapter 11 protection with plans to liquidate its remaining 35 stores, citing poor sales, online competition and residual problems from the COVID-19 pandemic, SGBOnline.com reported. The Auburn, Maine-based company filed for chapter 11 protection on Sunday in the U.S. Bankruptcy Court in Wilmington, DE, with $28.7 million in unsecured debt owed to 570 creditors. The case was filed alongside its owner, RSG Acquisitions, LLC and several of its non-operating affiliates. In July, Olympia Sports, which once had more than 200 stores on the East Coast, confirmed that it was shuttering its remaining 35 stores by the end of September, and liquidation sales at all its stores began. Olympia Sports was founded in 1975 by Edward Manganello, who opened his first store at the Maine Mall in South Portland. By 2013, it had 226 locations from Maine to Virginia. In October 2019, Olympia Sports was acquired by CriticalPoint, a Los Angeles-based private investment firm, and 76 stores were closed at the time. Olympia Sports became part of CriticalPoint’s active lifestyle platform, mainly consisting of the JackRabbit running chain, which it acquired in 2017. Last December, Fleet Feet acquired the JackRabbit running stores, with the Olympia Sports chain remaining under the ownership of CriticalPoint.

Some U.S. railroads will start halting crop shipments on Thursday, a day ahead of a potential work stoppage, an agricultural association and sources at two grain cooperatives said yesterday, threatening exports and feed deliveries for livestock, Reuters reported. With farmers starting to harvest autumn crops that are shipped to meat and biofuels producers, the shipping disruptions could add to already high inflation. Farmers also plan to add fertilizer to fields after the harvest, and shipments of fertilizer are being delayed. Max Fisher, chief economist at the National Grain and Feed Association, which represents most U.S. grain handlers, said that rail customers reported at least one railway would stop taking grain shipments on Thursday morning. Most major U.S. railways have already stopped accepting new shipments of ammonia fertilizer and other potentially hazardous materials, said Justin Louchheim, senior government affairs director at The Fertilizer Institute, an industry group. Louchheim said fertilizer producers are now evaluating how much storage they have for ammonia that cannot move by rail, and whether some can move by truck. The potential rail shutdown looms just six weeks before most Midwest farmers would begin applying fertilizer, said Josh Linville, fertilizer director at StoneX Group. About 40% of the U.S. fertilizer supply is on a rail car at some point before arriving on a farm, he said.

U.S. consumer prices overall rose more slowly in August from a year earlier, but increased sharply from the prior month after excluding volatile food and energy prices, showing that inflation pressures remained strong and stubborn, the Wall Street Journal reported. The Labor Department yesterday reported its consumer-price index rose 8.3% in August from the same month a year ago, down from 8.5% in July and from 9.1% in June, which was the highest inflation rate in four decades. The CPI measures what consumers pay for goods and services. So-called core CPI, which excludes often volatile energy and food prices, increased 6.3% in August from a year earlier, up markedly from the 5.9% rate in both June and July — a signal that broad price pressures strengthened. On a monthly basis, the core CPI rose 0.6% in August — double July’s pace. Investors and policy makers follow core inflation closely as a reflection of broad, underlying inflation and as a predictor of future inflation.

Tuesday Morning Corp. landed a $35 million financing deal from the company that controls Pier 1 Imports in a move that will strengthen the discount home-goods retailer’s balance sheet, WSJ Pro Bankruptcy reported. Dallas-based Tuesday Morning said on Friday that as part of the financing deal led by Retail Ecommerce Ventures LLC, the discount retailer will expand its offerings to include Pier 1 Imports merchandise. Tuesday Morning management, including Chief Executive Fred Hand, will participate in the financing by purchasing $3 million in junior notes, while Retail Ecommerce and Ayon Capital LLC, a family office focused on healthcare and technology investments, will purchase $32 million in convertible notes. The debt deal will result in a change in control, with Retail Ecommerce and Ayon appointing a majority of Tuesday Morning’s board. The Dallas chain was among a handful of retailers that filed for bankruptcy in 2020 after the government mandated stores to shut down in the early stages of the coronavirus pandemic.