Despite a pullback in auto sales, the Commerce Department released a report on Wednesday showing that U.S. retail sales rose by more than expected in the month of January.
The report said retail sales increased by 0.4 percent in January following an upwardly revised 1.0 percent jump in December.
Economists had been expecting sales to inch up by 0.1 percent compared to the 0.6 percent increase originally reported for the previous month.
The bigger than expected increase in retail sales came even though auto sales tumbled by 1.4 percent in January after surging up by 3.2 percent in December.
Excluding the drop in auto sales, retail sales climbed by 0.8 percent in January after rising by 0.4 percent in December. Ex-auto sales were expected to increase by 0.5 percent.
Sales by gas stations shot up by 2.3 percent in January following a 3.2 percent spike in December, with the continued increase partly due to higher gas prices.
The report also showed significant increases in sales by electronics and appliance stores, food services and drinking places, and sporting goods, hobby, book and music stores.
Closely watched core retail sales, which exclude autos, gasoline, building materials and food service, rose by 0.4 percent in January, matching the upwardly revised increase in December.
Paul Ashworth, Chief U.S. Economist at Capital Economics, said, "The upshot is that the improvement in consumer confidence since President Donald Trump's election victory now appears to be feeding through into stronger gains in actual spending."
The Commerce Department said total retail sales in January were up by 5.6 percent compared to the same month a year ago, reflecting an acceleration from the 4.4 percent increase in December.
by RTT Staff Writer
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