US retail sales gain a weak 0.1% in August
Washington – U.S. consumer spending edged up a slight 0.1 percent in September, a disappointing performance in which rebounding auto sales were offset by weakness in other areas.
The Commerce Department said Monday that the scant gain in September followed an equally meager 0.1 percent increase in August.
It was the weakest two-month performance since the start of the year and was well below economist projections of a solid 0.6 percent rise in sales.
Retail sales are closely watched for signs they can provide for consumer spending, which drives two-thirds of economic activity. The economy expanded at a sizzling 4.2 percent rate in the second quarter.
Analysts have been forecasting that growth will come in at still-solid rate above 3 percent in the just completed third quarter but the weakness in retail sales may cause them to rethink their forecasts.
The modest September gain was led by a 0.8 percent rise in auto sales which represented a rebound from a 0.5 percent decline in July. Analysts had been expecting the increase believing that sales would get a boost last month from purchases of replacement cars damaged by Hurricane Florence.
But excluding autos, retail sales fell 0.1 percent after sales excluding autos rose 0.2 percent in August.
In a more encouraging sign, sales in a so-called control group that feeds into calculations for the gross domestic product were up 0.5 percent in September after being flat in August.
Gasoline sales fell 0.8 percent in September after a 1.1 percent jump in August. That swing was influenced by prices which have retreated a bit after a big jump in August. The average price for a gallon of regular gas is $2.83 up from $2.47 a year ago, according to a nationwide survey by AAA.
Sales at general merchandise stores, which include big box stores such as Walmart and Target, rose 0.3 percent while sales at department stores fell 0.8 percent.