Retail Sales Inch Up
Americans increased their spending modestly in December, though less than economists had anticipated (Reuters).
What’s going on: “Retail sales rose 0.4% last month after an upwardly revised 0.8% gain in November, the Commerce Department’s Census Bureau said on Thursday.”
- Reuters-polled economists had forecast a 0.6% increase.
- Retail sales were up 3.9% from a year ago (Barron’s).
- The news comes the week after the release of the December U.S. employment report, which showed a surge in nonfarm payroll positions and a slight decline in the unemployment rate, to 4.1% from 4.2% in November.
The details: “Retail sales excluding automobiles, gasoline, building materials and food services surged 0.7% last month after an unrevised 0.4% gain in November,” according to Reuters. “These so-called core retail sales correspond most closely with the consumer spending component of gross domestic product.”
- Sales at restaurants and bars declined 0.3% in December, and those at building material and supplies dealers fell 2.0%.
- Automotive and parts dealers saw sales increase 0.7%, while gasoline stations saw a 1.5% jump (Barron’s).
What it means: “The Fed is not expected to cut rates this month,” Reuters reports. “Its benchmark overnight interest rate has been reduced by 100 basis points to the 4.25%–4.50% range, having been hiked by 5.25 percentage points in 2022 and 2023.”