U.S. retail sales rose 0.3% in January, the Commerce Department reported Feb. 13, as shopping activity rebounded unexpectedly despite mounting concerns about wider economic growth. The monthly snapshot was better than expected as most economists had expected retail sales to decline 0.3%t after sales posted a 0.4% drop in December.
Retail sales are tracked closely by economists to assess consumer spending which is a vital economic driver. "As the consumer goes, so goes the economy. It appears the consumer may have slowed down, but not left the field of battle," said Joel Naroff, the chief economist at Naroff Economic Advisors. The surprise rebound in sales was largely driven by improved vehicle and clothing store sales and an increase in turnover at gasoline stations.
Excluding automobile sales, which can fluctuate strongly, sales were up 0.3%.The improvement in overall sales and sales excluding autos marked the strongest gains since November. Driving the overall improvement in retail sales, auto dealers saw sales rebound 0.6% last month compared with a sharp 1.1% decline in December. The gain was the strongest since September of last year.
Gasoline station sales increased 2% after remaining unchanged in the prior month.
The lingering housing slump appeared to temper spending, however, as sales of furniture and other home furnishings declined 0.5% in January against a sharper 0.9% drop in December.
Electronics and appliance stores reported a 1% decline in sales compared with a heavy 3.2% slump in the last month of 2007 while building material and garden accessory sales fell 1.7% compared with 2.5% in December.
Copyright Agence France-Presse, 2008