Economic Takeaways of U.S. Retail Sales, Consumer Sentiment
- Gains in sales, confidence keep Fed rate increase on track
- Eight of 13 retail categories showed stronger sales last month
What you need to know about Friday’s U.S. economic data:
The Takeaway: Consumers began to stir during the month that kicks off the start of the holiday-shopping season. The gain in the headline retail sales figure was the strongest in four months, reflecting increased spending on nondurable items such as food, sporting goods and apparel. The government’s figures aren’t adjusted for changes in prices, and the cost of gasoline weighed on sales. More importantly, the retail figures used to calculate gross domestic product -- which exclude categories such as food services, auto dealers, home-improvement and service stations -- climbed by the most since May. The report indicates real consumption will rise at a 2.5 percent annualized rate in the fourth quarter, Steve Murphy, a U.S. economist at Capital Economics, wrote in a note to clients. “Not that there is much doubt any more, but this supports the case for a rate hike by the Fed next week,” he said.