(MENAFN- Saudi Press Agency) US retail sales fell unexpectedly in December, indicating that consumers remained cautious, the government said in a report Wednesday that is not likely to signal a trend of weaker consumer spending due to sharply lower gasoline prices and a strengthening labor market.
The Commerce Department reported that retail sales fell 0.9 percent last month, the biggest decline since last January. Sales at gasoline stations plunged 6.5 percent€"the biggest drop since late 2008€"due to lower prices, but sales in most other categories also declined.
Sales at general merchandise stores fell 0.9 percent in December, the most in four years. Automobile sales fell 0.7 percent. Sellers of electronics, building materials, clothing, and sporting goods all reported lower sales.
Retail sales excluding automobiles, gasoline, building materials, and food services fell 0.4 percent last month after rising 0.6 percent in November. The so-called €Åcore€€Œ retail sales correspond most closely with the consumer-spending component of gross domestic product (GDP).
Retail sales rose only 4 percent for all of 2014, the weakest performance since 2009, when the Great Recession ended. The disappointing sales figures come despite lower gasoline prices, which have freed up money for consumers to spend elsewhere.
The surprising December decline in retail sales could decrease expectations that consumer spending€"which accounts for 70 percent of U.S. economic activity€"accelerated sharply in the fourth quarter. But with the labor market strengthening and gasoline prices continuing to fall, last month€„¢s decline in core retail sales likely will be temporary, economists say.
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