Con­sumers rev up auto sales, in­crease their on­line shop­ping

Houston Chronicle - - BUSINESS -

WASHINGTON — Amer­i­cans stepped up their auto buy­ing and on­line shop­ping in De­cem­ber, re­flect­ing a boost in con­fi­dence af­ter the elec­tion and a solid in­crease in pay.

Re­tail sales rose a sea­son­ally ad­justed 0.6 per­cent, af­ter a small 0.2 per­cent gain in Novem­ber, the Com­merce Depart­ment said Fri­day.

Most of the strength was in auto sales, which jumped 2.4 per­cent in De­cem­ber, the big­gest gain since April. Gas sta­tion sales rose 2 per­cent, largely be­cause of higher prices. Ex­clud­ing au­tos and gas, re­tail sales over­all were flat.

The fig­ure dis­ap­pointed some econ­o­mists, who said it sug­gested that many con­sumers re­main cau­tious.

“Re­tail sales ap­pear healthy enough, but look­ing past the head­line there are a few con­cerns about the strength of con­sumer spend­ing,” said Paul Ash­worth, an econ­o­mist at Cap­i­tal Eco­nom­ics. Yet “with con­sumer con­fi­dence surg­ing to mul­ti­year highs af­ter the elec­tion and wage growth still solid, there is no rea­son to sus­pect that con­sump­tion growth is go­ing to weaken in the first half of this year.”

And there were other ar­eas of strength out­side au­tos. On­line re­tail­ers in par­tic­u­lar re­ported bet­ter sales. Home and gar­den cen­ters, fur­ni­ture stores and sport­ing goods re­tail­ers also saw sales grow.

In an­other re­port, hol­i­day sales rose 4 per­cent to about $658.3 bil­lion, ac­cord­ing to the Na­tional Re­tail Fed­er­a­tion. That beat a fore­cast for a 3.6 per­cent boost.

On­line sales alone rose 12.6 per­cent to $122.9 bil­lion, top­ping a fore­cast for growth of up to 10 per­cent. The big­gest down­turn came from depart­ment stores, with a 7 per­cent de­cline.

The healthy spend­ing was likely fu­eled by soar­ing con­sumer con­fi­dence, which has jumped af­ter the elec­tion to the high­est level in nearly a decade. Small busi­nesses are also more bullish. And av­er­age hourly pay rose 2.9 per­cent in De­cem­ber from a year ear­lier.

Mark Lennihan / As­so­ci­ated Press

An H&M store win­dow ad­ver­tises a sale in New York. Ex­clud­ing au­tos and gaso­line, re­tail sales over­all were flat in De­cem­ber.

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