The Economy

U.S. Retail Sales Slide 1.2%

Oct. 15, 2008

Major factor was auto sales which dropped 8.4% year-over-year

In a sign of deeper troubles for an economy ailing from a financial market firestorm and tight credit, U.S. retail sales slumped 1.2% in September, government data showed on Oct. 15.

The drop in sales was the steepest since August 2005 and weaker than market expectations for a 0.7% decline.

A major factor was weak auto sales, which plunged 8.4% year-over-year and 3.75% in the month.

But even excluding autos, retail sales were down a hefty 0.6% in September, the Commerce Department report showed.

"People have dropped shopping. This happened even before the total meltdown in the stock markets. What is ominous is that the declines in spending were broad-based," said Joel Naroff at Naroff Economic Advisors.

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