WASHINGTON, Dec 13 — US retail spending was unexpectedly sluggish in November as consumers held back at the start of the holiday shopping period, according to a government report today.
Shoppers tightened their purse strings at bars, restaurants and department stores while buying less clothing and fewer sporting goods, according to the Commerce Department’s monthly data.
The sales pace undershot forecasts and could weigh on GDP calculations for the final three months of the year.
The weaker figures contrasted sharply with industry data showing retailers had done a roaring trade during the post-Thanksgiving sales blitz on Black Friday and “Cyber Monday” — although the latter promotional shopping day fell in December.
Compared to October, total retail sales rose 0.2 per cent to US$528 billion, seasonally adjusted, less than half the gain economists had been expecting, the Commerce Department data showed.
The slowdown appeared larger because October’s estimate was revised upward by a tenth of a point to 0.4 per cent.\
November sales were 3.3 per cent higher than the same month last year.
Auto sales rose 0.5 per cent compared to October, but excluding the auto sector, retail sales rose just 0.1 per cent, far below the expected 0.4 per cent gain.
Online retailers like Amazon continued to rise but health and personal care sales were among the many decliners.
Ian Shepherdson of Pantheon Macroeconomics said the surprisingly weak November numbers could later be revised up.
But softer retail sales could also begin to undermine the widespread belief that amid historically low unemployment and rising wages, the American consumer is resisting a wider economic slowdown, he said in an analysis of the data.
“That narrative now looks harder to sustain,” he said, noting that “the softening in consumption will make it hard for Q4 GDP growth to breach 2 per cent.” — AFP
