WASHINGTON, Feb 14 — US consumer spending appears to have slowed further in January, with sales at clothing stores declining by the most since 2009, which could raise concerns about the economy’s ability to continue expanding at a moderate pace.
The Commerce Department said today retail sales excluding automobiles, gasoline, building materials and food services were unchanged last month. Data for December was revised down to show the so-called core retail sales rising 0.2 per cent instead of jumping 0.5 per cent as previously reported.
Core retail sales correspond most closely with the consumer spending component of gross domestic product.
Economists polled by Reuters had forecast core retail sales rising 0.3 per cent last month.
The unchanged reading in core retail sales suggested consumer spending slowed further after it lost considerable momentum in the fourth quarter.
Fed Chair Jerome Powell told lawmakers this week that the “economy is in a very good place, performing well.” The US central bank last month left interest rates steady. The Fed is widely expected to keep monetary policy on hold this year after it reduced borrowing costs three times in 2019.
The economy grew 2.3 per cent in 2019, slowing from 2.9 per cent in 2018.
Overall retail sales, however, rose 0.3 per cent in January. Data for December was revised down to show retail sales gaining 0.2 per cent instead of climbing 0.3 per cent as previously reported.
Auto sales rebounded 0.2 per cent after slumping 1.7 per cent in December. Receipts at service stations fell 0.5 per cent. Sales at electronics and appliance stores decreased 0.5 per cent.
Sales at building material stores jumped 2.1 per cent, the most since last August, after rising 1.3 per cent in December. Sales were likely boosted by unseasonably mild weather.
Receipts at clothing stores dropped 3.1 per cent last month, the most since March 2009. Online and mail-order retail sales rose 0.3 per cent. That followed a 0.1 per cent dip in December. Receipts at furniture stores rose 0.6 per cent.
Sales at restaurants and bars increased 1.2 per cent. Spending at hobby, musical instrument and book stores edged up 0.1 per cent. —Reuters