Retail sales in the U.S. rose less than forecast in August as the biggest part of the economy struggled to gain momentum.
The 0.2% increase was the smallest in four months and followed a revised 0.4% July gain that was bigger than previously estimated, the Commerce Department reported today in Washington. The median forecast of economists surveyed by Bloomberg called for a 0.5% advance. Sales excluding motor vehicles rose 0.1%.
Higher payroll taxes, limited job gains and restrained income growth are discouraging consumers, whose spending accounts for about 70% of the economy. Today’s report is one of the last pieces of data before next week’s Federal Reserve meeting, at which policy makers will consider whether to dial back record monetary stimulus.
“The consumer continues to tag along slowly but surely,” said Eugenio Aleman, a senior economist at Wells Fargo Securities LLC in Charlotte, North Carolina. Wells Fargo economists are the top forecasters of retail sales in the last two years, according to data compiled by Bloomberg. “We have to see better job growth, better income growth.”
Stock-index futures were little changed after the figures, with the contract on the Standard & Poor’s 500 Index expiring in December rising less than 0.1% to 1,678.4 at 8:48 a.m. in New York.
Estimates of the 85 economists in the Bloomberg survey ranged from gains of 0.2% to 0.9% after a previously reported 0.2% increase in July.
Eight of 13 major categories showed increased sales last month, led by auto dealerships, electronics outlets and furniture stores. Purchases of building materials, clothing and sporting goods fell.
The gain in retail sales excluding autos followed a 0.6% rise in July, today’s report showed. They were projected to increase 0.3% last month, according to the Bloomberg survey median.
Automobile dealer receipts climbed 0.9% after a 0.5% drop the prior month.
Cars and light trucks continue to be a bright spot in the economy, selling in August at the fastest annualized rate since November 2007, according to data from Ward’s Automotive Group. Sales at General Motors Co., Ford Motor Co., Toyota Motor Corp. and Honda Motor Co. all exceeded analysts’ estimates.