Retail Sales Rise 0.7 Percent in
January
By Joanne Morrison
WASHINGTON (Reuters) - U.S. retail sales picked up in
January after a sluggish Christmas shopping season, the
government said on Tuesday in a report showing new signs of
life in the sagging U.S. economy.
Total retail sales rose by 0.7 percent last month to $273.27
billion after gaining an anemic 0.1 percent in December, the
Commerce Department reported.
Excluding volatile automobile sales, retail sales rose by 0.8
percent last month after being flat in December.
Last month's gain in retail sales was higher than expected. Wall
Street economists surveyed by Reuters expected total retail sales
to rise by 0.6 percent and by 0.4 percent excluding automobile
sales.
The report was good news to economists, coming as it did after
a string of data which had shown consumer confidence
plummeting.
``People are spending and that should suggest that we are not
falling off a cliff into recession,'' said Bill Cheney, chief
economist at John Hancock Financial Services in Boston. But he
added that the gain could be reflecting a buying pickup due to
price slashing after the holidays.
The U.S. dollar ticked higher following the release.
The report showed across-the-board gains in retail spending, a
sign the slowing economy could be turning a corner. Consumer
spending fuels two-thirds of the U.S. economy.
``The fact that it is across the board makes people think that it
will go on,'' Cheney added.
Sales in durable goods, big ticket items intended to last for
several years, increased 0.8 percent in January after being flat in
December.
``The numbers were somewhat stronger than we thought,
especially in the durables category,'' said Ram Bhagavatula,
chief economist at Royal Bank of Scotland Financial Markets in
New York.
``This is hardly indicative of a consumer staying home. In the
durables category, there was across-the-board strength,'' he
added.
Spending on building materials posted a big increase last month,
gaining 1.1 percent after a 0.8 rise in December.
There was a decline in retail spending at food stores, where
spending dropped 0.2 percent last month, after gaining 0.9
percent in December.
But consumers picked up their spending at clothing and furniture
stories in addition to restaurants, the government said. |
