U.S. retail sales, seasonally adjusted, were $367.9 billion last month, 1.4% higher than retail sales in June, the U.S. Commerce Department reported on August 11. July's increase was significantly above the eight-tenths percent increase that economists generally expected.
In July, retail sales, excluding autos, rose 1%, twice what economists expected. Retail sales, not counting autos, had risen only a tenth of a percentage point in June.
Retail sales are a closely watched economic indicator since consumer spending accounts for about two-thirds of all U.S. economic activity.
Separately, the U.S. Commerce Department reported that business inventories, including manufacturers' inventories, were $1.34 trillion at the end of June, up eight-tenths of a percentage point from May. The figure was higher than economists expected and reflects a slower growing economy as the first half of 2006 came to a close.
