U.S. Retail Sales Rise Slight 0.2 Percent in August - WBOC-TV 16, Delmarvas News Leader, FOX 21 -

U.S. Retail Sales Rise Slight 0.2 Percent in August

Posted:
(Photo: MGN) (Photo: MGN)

WASHINGTON (AP)— Americans boosted their spending at retail businesses only modestly in August, indicating that economic growth remains sluggish. Consumers bought more cars, furniture and electronics last month but held back on most other purchases.

Spending at retail businesses rose just 0.2 percent last month, the Commerce Department said Friday. It was the smallest gain in four months. But the government said retail spending was stronger in the previous month than first estimated, revising the July estimate to 0.4 percent from 0.2 percent

Excluding volatile spending on autos, gas and building supplies, sales in August increased just 0.2 percent, or less than half July's 0.5 percent gain.

Consumer may be growing more cautious about spending, a trend that could slow economic growth in the July-September quarter. Slow wage growth, modest job gains and higher taxes have limited Americans' spending power.

Retail sales are closely watched because they're the government's first look each month at consumer spending, which accounts for 70 percent of economic activity.

"Consumer spending remained stuck in middle gear in the summer," said Sal Guatieri, an economist at BMO Capital Markets.

Guatieri forecasts that spending is growing at an annual rate of roughly 2 percent in the current July-September quarter, about the same as the previous quarter. That suggests economic growth is slowing to an annual rate of about 2 percent, down from the 2.5 percent annual rate that the government estimated for the April-June quarter.

Most economists said the retail sales figures are likely healthy enough for the Federal Reserve to begin cutting back its monthly bond purchases when it meets next week. The Fed is buying $85 billion in Treasury bonds and mortgage-backed securities each month to keep interest rates low and spur more borrowing and spending.

Sales of autos and furniture both jumped 0.9 percent in August. Electronics and appliance sales rose 0.8 percent. But clothing sales dropped 0.8 percent and sporting goods sales also fell.

Last week automakers reported that their sales in August topped 16 million at an annual pace for the first time since November 2007, just before the recession began. Toyota, Ford, Nissan, Honda, Chrysler and General Motors all posted double-digit gains over last August.

But many retailers have said in recent weeks that shoppers have been reluctant to spend freely for back-to-school shopping. According to a tally of 10 retail chains by the International Council of Shopping Centers, sales rose 3.6 percent last month. That's down from a 6 percent gain for in August 2012.

Job gains have been steady this year. But the pace of hiring has been too weak to rapidly lower the unemployment rate, which is 7.3 percent four years after the Great Recession officially ended.

  • Delmarvawide NewsDelmarvawide NewsMore>>

  • Trimper's Rides Sued

    Trimper's Rides Sued

    Thursday, July 31 2014 9:32 PM EDT2014-08-01 01:32:56 GMT
    Friday June 28, 2012 started out as a normal day at the amusement park for J and his family until they rode the Hampton I, a mini car and truck ride.More
    Friday June 28, 2012 started out as a normal day at the amusement park for J and his family until they rode the Hampton I, a mini car and truck ride.More
  • Damaged I-495 in Delaware Partially Reopens

    Damaged I-495 in Delaware Partially Reopens

    Thursday, July 31 2014 9:10 PM EDT2014-08-01 01:10:50 GMT
    DOVER, Del. (AP/WBOC) - Delaware transportation officials partially reopened a bridge on a key East Coast interstate that was closed in early June because several supporting columns were tilting. Officials said southbound lanes of the Interstate 495 bridge over the Christina River reopened Thursday afternoon, about a month earlier than expected. Officials said repairs have gone faster than expected. A jacking operation to realign the south side of the bridge was completed about midday Thursda...More
    DOVER, Del. (AP/WBOC) - Delaware transportation officials partially reopened a bridge on a key East Coast interstate that was closed in early June because several supporting columns were tilting. Officials said southbound lanes of the Interstate 495 bridge over the Christina River reopened Thursday afternoon, about a month earlier than expected. Officials said repairs have gone faster than expected. A jacking operation to realign the south side of the bridge was completed about midday Thursda...More
  • South Bethany Prepares for New House Height Ordinance

    South Bethany Prepares for New House Height Ordinance

    Thursday, July 31 2014 8:43 PM EDT2014-08-01 00:43:51 GMT
    SOUTH BETHANY, Del. - The South Bethany Town Council will vote on an ordinance that would extend the maximum height a home could be as long as the homeowner adds freeboard as well. Currently, the height maximum is at 32 feet. More
    SOUTH BETHANY, Del. - The South Bethany Town Council will vote on an ordinance that would extend the maximum height a home could be as long as the homeowner adds freeboard as well. Currently, the height maximum is at 32 feet. More
Powered by WorldNow

All content © Copyright 2000 - 2014 Worldnow and WBOC. All Rights Reserved. For more information on this site, please read our Privacy Policy and Terms of Service