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US retailers see sales slow as snow trims wide spending
Source: Agencies |
February 16, 2011, Wednesday
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Print Edition
Print Edition
SALES at United States retailers slowed in January as extreme weather in large parts of the country kept some shoppers at home, but the underlying improving trend in spending remained intact.
Total retail sales rose 0.3 percent, the US Commerce Department said yesterday, advancing for a seventh straight month. Sales rose 0.5 percent in December.
Economists polled by Reuters had expected retail sales to increase 0.6 percent last month. Compared with January last year, sales were up 7.8 percent.
"Seventy percent of the country was covered by snow in January so, if anything, it's a miracle the consumer didn't just hibernate," said Chris Rupkey, chief financial economist at Bank of Tokyo/Mitsubishi UFJ in New York.
Economists also noted that sales were taking a breather after recent hefty gains and expected the upward trend to resume, spurring the economic recovery. The US economy grew at a 3.2 percent annual rate in the fourth quarter of 2010, powered by robust consumer spending.
However, revisions to the retail sales data from prior months suggested fourth-quarter growth may not have been quite as robust as first reported. Barclays Capital economist Theresa Chen said she lowered her estimate for fourth-quarter spending growth to 4.2 percent from an initially reported 4.4 percent.
Excluding autos, sales increased 0.3 percent last month, below economists' expectations for a 0.5 percent gain, after rising 0.3 percent in December.
Sales last month were held back by a 2.9 percent drop in receipts at building material and gardening outlets after rising 1.8 percent in December. Sales at food and drinking places fell 0.7 percent, while receipts at clothing and clothing accessories stores slipped 0.3 percent.
But so-called core retail sales, which exclude autos, gasoline and building materials, increased 0.5 percent after slipping 0.1 percent in December.
Core sales correspond most closely with the consumer spending component of the government's gross domestic product report. Consumer spending, which accounts for 70 percent of US economic activity, increased at a 4.4 percent annual rate in the fourth quarter.
January sales at some major US retail chains came in well ahead of analysts' expectations, showing that shoppers who braved snowstorms were buying, not just browsing.
Still, experts predict that people will largely remain frugal and focus on bargains this year.
Total retail sales rose 0.3 percent, the US Commerce Department said yesterday, advancing for a seventh straight month. Sales rose 0.5 percent in December.
Economists polled by Reuters had expected retail sales to increase 0.6 percent last month. Compared with January last year, sales were up 7.8 percent.
"Seventy percent of the country was covered by snow in January so, if anything, it's a miracle the consumer didn't just hibernate," said Chris Rupkey, chief financial economist at Bank of Tokyo/Mitsubishi UFJ in New York.
Economists also noted that sales were taking a breather after recent hefty gains and expected the upward trend to resume, spurring the economic recovery. The US economy grew at a 3.2 percent annual rate in the fourth quarter of 2010, powered by robust consumer spending.
However, revisions to the retail sales data from prior months suggested fourth-quarter growth may not have been quite as robust as first reported. Barclays Capital economist Theresa Chen said she lowered her estimate for fourth-quarter spending growth to 4.2 percent from an initially reported 4.4 percent.
Excluding autos, sales increased 0.3 percent last month, below economists' expectations for a 0.5 percent gain, after rising 0.3 percent in December.
Sales last month were held back by a 2.9 percent drop in receipts at building material and gardening outlets after rising 1.8 percent in December. Sales at food and drinking places fell 0.7 percent, while receipts at clothing and clothing accessories stores slipped 0.3 percent.
But so-called core retail sales, which exclude autos, gasoline and building materials, increased 0.5 percent after slipping 0.1 percent in December.
Core sales correspond most closely with the consumer spending component of the government's gross domestic product report. Consumer spending, which accounts for 70 percent of US economic activity, increased at a 4.4 percent annual rate in the fourth quarter.
January sales at some major US retail chains came in well ahead of analysts' expectations, showing that shoppers who braved snowstorms were buying, not just browsing.
Still, experts predict that people will largely remain frugal and focus on bargains this year.
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