US retail sales rebound in January from bleak December
WASHINGTON: The US economy saw retail sales rebound slightly in January but December’s sales were even worse than originally reported, according to government data.
The bleak December figures were yet another sign of the economic angst in the latter part of 2018, amid a Wall Street rout and as the US- China trade war inflamed fears of a global slowdown.
Retail sales gained 0.2 per cent in January, in line with economists’ forecasts.
But December sales fell 1.6 per cent from the prior month, revised from the 1.2 per cent decline originally reported – the worst drop in 10 years, the Commerce Department said.
The data collection and release were delayed due to the five-week government shutdown as President Donald Trump demanded funding for a border wall, which also sapped consumer and business confidence.
The first quarter of 2019 is not expected to help the White House fulfill its pledge for 3 per cent growth this year, as most economists, including the Federal Reserve and International Monetary Fund project a slowdown.
The slight rebound in retail sales was “not enough to rescue Q1 consumption,” Ian Shepherdson of Pantheon Macroeconomics said.
He cautions that the data are subject to repeated revisions but will not return to the pace of a year ago, “given the fading boost from the tax cuts and the drop in gas prices in Q4.”
“But the December plunge probably overstates the downshift substantially,” he said in a research note.
Compared to the same month of the previous year, sales in January were 2.3 per cent higher, while December was up 1.7 per cent, according to the report.
For the monthly gain excluding motor vehicles and parts, January sales were better – up 0.9 per cent – and December’s were much worse: a drop of 2.1 per cent.
Online retailers saw sales jump 2.6 per cent in January from the prior month, after a 5 per cent drop in December, the data showed.
At the start of the year, retailers posted big declines for motor vehicles, furniture, clothing and gasoline stations, with gains for sporting goods and book stores, building materials and garden supplies, food and beverage and health. — AFP