Retail Sales Up More Than Expected in November

RetailReuters

Sales at U.S. retailers rose more than expected in November as consumers splurged on clothing and other items at the start of the holiday season and receipts at gasoline stations surged, more evidence the economic recovery gathered steam in the fourth quarter.

The Commerce Department said on Tuesday total retail sales increased 0.8%, advancing for a fifth straight month. Sales for October were revised up to 1.7% from a previously reported 1.2% gain.

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Economists polled by Reuters had expected retail sales to increase 0.6% last month. Compared to November last year sales were up 7.7%.

Excluding autos, sales rose 1.2% last, exceeding economists' expectations for a 0.6 % gain. Sales excluding autos increased 0.8% in October.

The data was the latest to imply an acceleration in economic growth during the current quarter after output expanded at a 2.5% annual pace in the July-September period.

However, it will probably not be strong enough to discourage the Federal Reserve from completing its $600 billion government debt buying program intended push already low interest rates further down and stimulate demand.

Policymakers from the U.S. central bank meet on Tuesday to assess the economy and are widely expected to stay the course of accommodative monetary policy.

Sales last month were buoyed by a 2.7% rise in receipts at clothing and clothing accessories stores, the largest increase since March. Consumers also spent on non-essential goods, lifting sales at sporting goods, hobby, book and music stores 2.3%, the biggest gain in almost a year.

Sales were also boosted by a 4% jump in receipts at gasoline stations, which was the largest gain in a year. But motor vehicle sales surprisingly fell 0.8%, while building materials dipped 0.1% after rising 3.3% in October.

Core retail sales, which exclude autos, gasoline and building materials, rose 0.9% after a 0.5% gain in October. Core sales correspond most closely with the consumer spending component of the government's gross domestic product report. Spending, which accounts for 70% of U.S. economic activity, increased at a 2.8% annual rate in the third quarter.

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