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Wednesday, October 15, 2008
Producer Prices, Retail Sales Tick Lower
FOXBusiness
As credit markets froze up and banks failed, U.S. consumers stayed away from malls and shops during the month of September -- another sign that the U.S. economy is slipping closer to a recession.
The U.S. Commerce Department said September retail sales fell by 1.2% from the month before. It’s the third straight month retail sales have fallen, and the fourth time retail sales have fallen in nine months.
Retail sales are an important indicator for the U.S. economy because consumer spending makes up nearly 70% of the nation’s gross domestic product. If consumers did not purchase products for back to school, and going forward for the holidays, it will be all but certain that the U.S. will slip into a recession.
“The retail sales data for September virtually locks in a negative gross domestic product report for the third quarter,” said FOX Business Chief Economist Mark Lieberman.
All the sectors tracked by the Commerce Department saw declines in sales from the month before.
Also, wholesale prices fell in September, the Labor Department said. That's the second consecutive monthly drop.
The producer price index fell 0.4% in September, matching analysts' expectations.
Core PPI, which excludes volatile food and energy costs, increased 0.4%, above analysts' expectations of a 0.2% increase.
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