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U.S. Retail Sales Rise 0.2% In January, Slightly More Than Expected

04:17, 12th February 2016

(RTTNews) - Partly reflecting an increase in auto sales, the Commerce Department released a report on Friday showing that U.S. retail sales rose by slightly more than anticipated in the month of January.

The Commerce Department said retail sales climbed by 0.2 percent in January compared to economist estimates for a 0.1 percent uptick.

The report also showed that retail sales in December rose by an upwardly revised 0.2 percent compared to the 0.1 percent drop initially reported.

The modest increase in retail sales was partly due to growth in sales by motor vehicle and parts dealers, which climbed by 0.6 percent in January after rising by 0.5 percent in December.

Excluding auto sales, retail sales inched up by 0.1 percent in January, matching the revised increase in December. Economists had expected ex-auto sales to come in unchanged.

While the report showed notable increases in sales by miscellaneous and non-store retailers, sales by gas stations plunged by 3.1 percent amid lower gasoline prices.

Core retail sales, which exclude autos, gasoline, and building materials, increased by 0.6 percent in January following a 0.3 percent decrease in December.

Paul Ashworth, Chief U.S. Economist at Capital Economics, said, "All things considered, it appears that the net impact of the record wet AND warm weather in December was negative, with a clear rebound in January as the weather returned to more seasonal norms."

"Note too that the strength of sales in January came despite the massive snowstorm that blanketed much of the east coast for an entire weekend," he added.

Ashworth predicted the report won't persuade the Federal Reserve to raise interest rates next month in light of the tantrum by the markets, but he said it is another sign economic growth is actually accelerating.

The Commerce Department said total retail sales in January were up by 3.4 percent compared to the same month a year ago, reflecting an acceleration from the 2.4 percent annual growth seen in December.

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