Retail sales opened the year with a bigger-than-expected bounce, official data showed on Feb. 12. The Commerce Department reported that seasonally adjusted retail sales increased 0.5% to $355.8 billion in January.
"Consumers opened their wallets a little wider and that is good news for the economy," said Joel Naroff of Naroff Economic Advisors.
The Commerce Department revised the decline in December sales to a scant 0.1%, from a drop of 0.3%, and the November sales increase was raised 0.2 point to 2%. "With last months decline being revised upward, this report is even stronger than it looks," Naroff said. But he warned that "between snowstorms and Toyota shutting down sales for a while, I would not be surprised if the February numbers are weak."
The latest data, which are not adjusted for price changes, showed sales fell in only four of the 13 sectors measured, notably in housing-related sectors such as furniture and building materials.
Excluding often-volatile auto and gasoline sales, retail sales rose 0.6%.
January retail sales were up 4.7% from the year-ago level, when consumers hunkered down in the face of the 13th month of official recession.
Consumer spending drives two-thirds of U.S. output and is a key in sustaining the economy's government-stimulated recovery from the worst recession in decades. However, President Barack Obama's administration has repeatedly emphasized that consumer spending would not be as powerful a driver in this economic recovery as it has in past recessions.
Many analysts share that view and are forecasting weak consumer spending in the coming months, particularly as authorities wind down extraordinary measures taken to stimulate the recovery.
US gross domestic product (GDP) expanded at a strong 5.7% pace in the fourth quarter, in a second straight quarter of growth after four quarters of contraction.
Copyright Agence France-Presse, 2010
