WASHINGTON – U.S. retail sales rose by 0.2 percent in October, the Commerce Department said on Friday, matching expectations after a sharp drop in auto sales was offset by solid growth in other areas.
Wall Street had predicted the modest advance in payback from September's car-fueled performance. This was revised to show an 1.6 percent gain compared with the 1.5 percent gain that was initially reported.
Excluding auto sales, which can swing sharply from month to month, retail sales were up 0.9 percent compared with forecasts for a 0.5 percent gain and after a 0.8 percent gain in September, revised up from 0.6 percent.
Sales of motor vehicles and parts declined 2.2 percent, a performance that had been anticipated following September's strong incentive-induced 4.3 percent surge as dealers cut prices to boost end-of-season sales.
Economists scrutinize retail sales as a dominant component in consumer spending which in turn makes up two thirds of U.S. economic output, and the numbers indicate that record oil prices were making themselves felt at the start of the fourth quarter.
Sales at gasoline stations jumped 4.3 percent, reflecting the impact of crude oil prices of $55 a barrel during the month. Oil prices have since edged back under the $50/barrel threshold.
General merchandise sales were also higher, advancing 0.9 percent after a 1.3 percent climb in September, while clothing and accessories posted a 3.0 percent climb, which was the largest monthly increase in two years.
But building materials and garden equipment, which had been buoyed by the strong housing sector as low interest rates fuel the property market, dipped 1.1 percent although it remains 9.5 percent higher over the year.