By Harriet Torry and Amara Omeokwe 

WASHINGTON-Retail sales advanced at a modest pace in November, signaling a slower-than-expected start to the critical holiday shopping season.

Retail sales, a measure of consumer spending at stores, restaurants and online, increased a seasonally adjusted 0.2% in November from a month earlier to $528.0 billion, the Commerce Department said Friday.

The advance was much weaker than the 0.5% increase economists forecast. Excluding the volatile categories of autos and gas, retail sales were flat in November.

Sales declined sharply in November across a number of categories that are closely tied with holiday gift-giving, like clothing, department and sporting goods stores. Spending at bars and restaurants dropped 0.3% last month, the steepest monthly decline since December last year.

As the traditional start of the holiday-shopping season, November is a key month for retailers, especially for department stores, clothing outlets and online sellers.

The month includes Thanksgiving Day and Black Friday, days in which Americans crowd malls and shop online for deals. Due to a late Thanksgiving, there are six fewer days in the holiday shopping season this year compared with 2018.

At Rolling Oaks Mall near San Antonio, Texas, Phillip Iversen said while most of his holiday shopping is now done online, certain deals still bring him to the mall for Black Friday promotions.

Mr. Iversen found a waffle maker at Macy's inside Rolling Oaks for about $7 on Nov. 28.

"I think they have to have the price that low now," the 35-year old said of the deal.

November sales at electronics and appliance stores rose 0.7% last month but slid 1.5% from a year earlier. Sales at nonstore retailers, a category that includes internet merchants like Amazon.com, were up 0.8% from October and grew 11.5% from a year earlier.

Richard Derr, owner of Learning Express Toys in Lake Zurich, Ill. said "this has been the strangest season I have ever seen for toys." The season started slow with weak months in October and November, and demand for December has only just started to pick up.

"There's just this malaise that we see in shoppers. We know it's not their pocketbooks," he said, citing the strong labor market and rising incomes. "There's just an overhang that we see in shoppers that they're really, really delayed this season."

Sales at motor vehicle and parts dealers, which make up about 20% of total retail sales, rose 0.5% last month. Gas station sales advanced 0.7%.

The Commerce Department report paints a more pessimistic picture of the start to the holiday season than separate data that suggests a strong sales so far, particularly in online spending.

Online holiday sales were up 14.1% from a year ago at $105.4 billion through Wednesday, according to Adobe Analytics, which tracks activity on thousands on websites.

October retail sales were revised slightly higher in Friday's report, to a 0.4% increase. From a year earlier, November retail sales increased 3.3%.

Weaker than expected sales in November suggests the pace of consumer spending eased somewhat as the fourth quarter progressed, which will feed into the broader pace of economic growth in the October to December period.

The economy expanded at a 2.1% annual pace in the third quarter, and forecasting firm Macroeconomic Advisers most recently projected a 1.9% pace for the fourth.

The Commerce Department's retail sales report can be found at http://www.census.gov/retail/marts/www/marts_current.pdf.

(Sebastian Herrera contributed to this article)

 
 
 

(END) Dow Jones Newswires

December 13, 2019 08:45 ET (13:45 GMT)

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