July Retail Sales Rose More Than Forecast

Retail sales advanced 0.8% in July, the first gain in four months, according to a report released by the Commerce Department.  Sales were fueled by strength from the automobile sector, electronics and appliance outlets, and department stores.

The bigger than expected increase followed a 0.7% decline in June that was weaker than first reported.  Bloomberg had forecast a 0.3% rise in July.  The results have buoyed feelings overall that the economy may be improving, albeit at a moderate pace.

"We're looking for consumption to pick up," Credit Agreicole CIB chief economist Michael Carey told Bloomberg.  "There was improved consumer confidence in July plus job gains that were a little better than expected, which is certainly constructive for the household outlook."

Retail sales, which climbed the most since February, followed a quarter in which household spending grew at the slowest pace in a year.  Consumer purchases, about 70% of the economy, increased at a 1.5% annual rate from April to June.

All 13 major retail categories showed a gain last month, led by a 0.8% jump at auto dealers, a 0.9% rise at electronics and appliance outlets, and a 0.6% increase at department stores that was the most since September.

Spending increased 0.8% at clothing stores and 0.7% at general merchandise stores.  Health and personal care sales jumped 1.1%, the most since May 2011.

Industry data also showed that same-store sales at the more than 20 retailers tracked by Retail Metrics Inc. gained 4.4% in July, almost four times analysts' estimates, after only a 0.3% rise in June.

Sales excluding automobiles and service stations advanced 0.9%, the most since January.

Source:  retailingtoday.com