US Retail Sales Increased in January in Broad-Based Advance
Retail sales increased for a third straight month in January as Americans kicked off 2016 by spending freely on cars, clothing and online merchandise.
The 0.2% gain matched the previous month’s advance that was initially reported as a decline, Commerce Department data showed Feb. 12. The median forecast in a Bloomberg News survey called for a 0.1% increase in January. Excluding cheaper gasoline, which depressed service-station receipts, purchases climbed 0.4%.
Greater job security, improving wage growth and falling gasoline prices may be persuading more consumers to loosen their purse strings after a fourth-quarter slowdown. A pickup in household purchases, which account for the lion’s share of the economy, would help the U.S. stave off the negative effects of a strengthening dollar, sluggish foreign demand and tumultuous financial markets.
“Consumer fundamentals still look very strong,” said Bricklin Dwyer, an economist at BNP Paribas in New York. “We had really strong real incomes at the end of last year, and that’s going to feed through to consumption.”
Estimates in the Bloomberg survey ranged from a decline of 0.5% to a 0.4% gain. December retail sales were revised up to a 0.2% advance, previously reported as down 0.1%.
The retail figures used to calculate gross domestic product, which exclude categories such as food services, auto dealers, home-improvement stores and service stations, increased 0.6% in January, the most since May, after falling 0.3% the month before.
Economists are looking for a pickup in consumer spending to help buoy growth this quarter after the expansion slowed to a crawl at the end of 2014. Gross domestic product grew at a 0.7% annualized rate in the fourth quarter as companies adjusted inventories and cut back on capital investment.
Eight of 13 major categories showed increases in demand in January from the prior month, the retail figures showed. Purchases made online climbed 1.6%, the most in 11 months. Sales at general merchandise outlets rose 0.8%, the biggest advance since May.
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|By Victoria Stilwell |
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