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US retail sales increase, but with a caveat on consumer demand
[WASHINGTON] US retail sales rose in January for a fourth straight month as cheaper prices at the gas pump encouraged Americans to spend, though a core measure of demand softened.
The value of overall sales climbed 0.3 per cent, Commerce Department figures showed Friday. But the so-called control group subset of sales was unchanged in January after a downwardly revised December gain. That measure excludes food services, car dealers, building-materials stores and gasoline stations, providing a reading that's tied better to underlying consumer demand. Sales retreated at electronics outlets, clothing stores and personal care shops.
Treasury prices rose and equity futures pared gains after the report.
Broadly, demand at retailers remained steady, indicating the consumer is still the economy's key fuel source. Federal Reserve Chairman Jerome Powell said in congressional testimony this week that there's no reason that a scenario of generally strong job growth and rising wages can't go on.
Meanwhile, economic risks remain with sluggish export markets, weak business spending and any fallout from the coronavirus.
The retail sales report showed nine of 13 major categories increased, including the largest gains at building materials outlets and non-store merchants since August. Receipts at general merchandise stores were the strongest in six months, while sales at furniture and home furnishing stores were the best in four.
The Commerce Department's report showed gas-station receipts declined 0.5 per cent on lower fuel prices.
Excluding receipts at filling stations, retail purchases increased 0.3 per cent, the most in five months.
Sales at car dealers rose 0.2 per cent in January.
Excluding automobiles and gasoline, retail sales advanced 0.4 per cent after a 0.5 per cent gain the previous month.