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US retail sales rise; core sales revised sharply
[WASHINGTON] US retail sales increased in December as households bought a range of goods and figures for the prior month were revised higher, suggesting the economy exited 2017 with strong momentum.
The Commerce Department said on Friday that retail sales rose 0.4 per cent last month. Data for November was revised to show sales gaining 0.9 per cent instead of the previously reported 0.8 per cent increase.
Retail sales in December rose 5.4 per cent from a year ago.
They advanced 4.2 per cent in 2017 compared to 3.2 per cent in 2016. Economists polled by Reuters had forecast retail sales increasing 0.4 per cent in December.
Sales last month were supported by a 1.2 per cent jump in receipts at gardening and building material stores. Sales at auto dealerships rose 0.2 per cent. Sales at service stations were unchanged last month.
Excluding automobiles, gasoline, building materials and food services, retail sales increased 0.3 per cent last month after an upwardly revised 1.4 per cent surge in November.
These so-called core retail sales correspond most closely with the consumer spending component of gross domestic product. They were previously reported to have increased 0.8 per cent in November.
Last month's increase in retail sales and the sharp upward revision to November data bolsters economists' expectations of an acceleration in consumer spending in the fourth quarter. Consumer spending, which accounts for more than two-thirds of US economic activity, increased at a 2.2 per cent annualised rate in the third quarter.
The economy grew at a 3.2 per cent pace during that period. Spending could get a modest lift from a US$1.5 trillion package of tax cuts passed by the Republican-controlled US Congress and signed into law by President Donald Trump last month.
The bulk of the tax relief is skewed toward high-income households, who economists say have a low propensity to consume.
Last month, sales at electronics and appliance stores fell 0.2 per cent. Receipts at clothing stores declined 0.3 per cent. Sales at online retailers soared 1.2 per cent.
Receipts at restaurants and bars rose 0.7 per cent, the biggest gain since January. Sales at sporting goods and hobby stores dropped 1.6 per cent, the biggest decline since November 2016.