US retail sales rise in December 

(MENAFN - AFP) US retail sales in December rose more than expected, official data released Tuesday showed, suggesting solid consumer spending despite an ongoing debate in Washington over the fiscal cliff.

Retail and food service sales adjusted for seasonal variation and holiday differences jumped 0.5 percent in December from the November level, according to data released by the Commerce Department. Analysts had projected an increase of just 0.2 percent.

Sales of automobiles were particularly strong, rising 1.6 percent from the November level. Also higher were sales of clothing and clothing accessories, up 1.0 percent from the November level.

However, sales at gasoline stations were 1.6 percent lower than in November, while sales of electronics and appliances fell 0.6 percent from the level in the prior month.

Retail sales are a major component of consumer spending, which accounts for about 70 percent of economic activity.

The December sales came during a heated debate in Washington over taxing and spending policies that was resolved only on Jan. 1. More fighting is expected in the weeks ahead as the two political parties contend with a debate on raising the debt ceiling.

Natixis analyst Mufteeva Inna characterized the results as "rather good," pointing to other US data that suggested low inflation means spending rose in "real terms." But Inna said the expiration of some tax cuts from the January 1 deal "should weigh on the households finances and the purchases intents in the months to come."