US Retail Sales Rise 0.4% In December, In Line With Estimates

Andrew Cummings
January 13, 2018

Online retailers reported a strong sales gain of 1.2 percent.

Retail sales - a measure of consumer spending at stores, restaurants and websites - increased a seasonally adjusted 0.4% in December from the prior month, the Commerce Department said Friday, matching expectations of economists surveyed by The Wall Street Journal. Consumer spending, which makes up for over two-thirds of US economic activity, increased at a 2.2 percent annualized rate for the third quarter.

American consumers continued to spend at stores in December, capping a robust year for retailers.

There were $495.4 billion in retail and food service sales in December, up 0.4% from the previous month and 5.4% from December 2016, according to the U.S. Census Bureau.

Excluding auto sales, retail sales still rose by 0.4% in December after jumping by 1.3% in November.

Consumer confidence is at 17-year highs, equity markets are in record territory, housing continues to post steady gains and wage growth has been steadily around 3% [or more], according to a note from Retail Metrics President Ken Perkins emailed to Retail Dive. Sales at nonstore retailers, mostly online-shopping outlets, rose 12.7% on the year.

USA retail sales grew more strongly than expected last month amid especially strong demand for building materials and for on-line retailers.

Consumer spending is the main engine of the USA economy, accounting for more than two-thirds of total economic output. "Overall, though, these data are consistent with the very elevated consumer confidence numbers, and they imply that the saving rate, which is already very low, continues to decline", said Ian Shepherdson, chief economist at Pantheon Macroeconomics.

Sales at gasoline stations were unchanged during December after growing 3.0% in November. The industry has been under pressure as shoppers can buy sporting goods in big box stores and online. stock is down roughly 43 percent since December 2016. Taken together, analysts said, that represented the best holiday spending performance since 2005. Apparel and accessories sales fell 0.3% from November but annual sales in the category rose 2.4% year over year in 2017, while sporting goods sales fell 1.6% from November and 0.1% year over year.

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