Retail sales dipped 0.2% in August as auto sales fell
Washington — Consumers cut back on their shopping in August by the largest amount in six months as declining auto sales offset gains in other areas.
Retail sales dropped 0.2 percent last month after a 0.3 percent gain in July, the Commerce Department said Friday. It was the biggest one-month decline since a 0.2 percent decline in February. Auto sales sank 1.6 percent in August, the most in seven months.
Excluding autos and gas, which tend to be volatile from month to month, sales dipped 0.1 percent in August after having risen 0.5 percent in July.
Still, thanks to a still-solid job market, economists generally remain upbeat about retail sales in coming months, with many saying they expect consumer spending to grow at a solid 2.5 percent rate in the July-September quarter.
Sales rose last month at general merchandise stores, a category that includes big-box retailers such as Target. Rising gasoline prices also boosted sales.
The overall economy, as measured by the gross domestic product, grew at a robust 3 percent annual rate in the April-June quarter, more than double the lackluster 1.2 percent rate in the first quarter. Analysts generally predict that growth in the current July-September quarter will remain in a solid range of 2.5 percent to 3 percent, with a key boost coming from consumer spending.
The consumer sector, which contributes to 70 percent of economic activity, is benefiting from the lowest unemployment rates in 16 years and continued strong job gains.
For August, gasoline sales were up 2.5 percent, the biggest jump since last December. But that increase reflected in large part rising prices.
Sales at general merchandise stores, which includes big-box retailers such as Walmart and Target, were up 0.2 percent although sales at department stores including Macy’s, edged down 0.1 percent. Sales at non-store retailers, a category that covers booming online sales, dropped 1.1 percent in August after a 1.8 percent gain in July.
Copyright 2017 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.