Suggesting that the holiday shopping season began on an upbeat note, the Commerce Department released a report on Thursday showing that U.S. retail sales rose by slightly more than expected in the month of November.
The report said retail sales rose by 0.7 percent in November following an upwardly revised increase of 0.6 percent in October.
Economists had expected sales to increase by about 0.6 percent compared to the 0.4 percent growth originally reported for the previous month.
The continued sales growth in November was partly due to a 1.8 percent jump in sales by motor vehicle and parts dealers, which followed a 1.1 percent increase in October.
Excluding the jump in auto sales, retail sales increased by 0.4 percent in November compared to the 0.5 percent growth in October. The increase in ex-auto sales exceeded economist estimates for a modest 0.2 percent uptick.
While the report also showed that building materials sales surged up by 1.8 percent in November after falling by 1.5 percent in October, sales at gas stations tumbled by 1.1 percent following a 0.4 percent drop in the previous month.
Core retail sales, which exclude auto, gasoline, and building materials sales, rose by 0.5 percent in November compared to an upwardly revised 0.7 percent increase in October.
The report showed strong growth at non-store retailers, food services and drinking places, furniture and home furnishings stores, and electronics and appliance stores.
"The bottom line is that underlying sales growth has been strengthening for some months now," said Paul Dales, Senior U.S. Economist at Capital Economics. "This will continue as jobs growth accelerates and as the rises in equity and house prices boost wealth."
He added, "Real annualized consumption growth may be between 3.0% and 3.5% in the fourth quarter, which would generate overall GDP growth of at least 2.0% this quarter."
The Commerce Department said total retail sales in November were up by 4.7 percent compared to the same month a year ago.
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