WASHINGTON (Reuters) – Sales at U.S. retailers posted their largest gain in five months in August on strong receipts at gasoline stations and clothing outlets, further assuaging fears of a double-dip recession.
The Commerce Department said on Tuesday total retail sales rose 0.4 percent following a revised 0.3 percent rise in July. It was the second straight month of gains in retail sales, which are a measure ofconsumer health. July sales had been previously reported to have increased 0.4 percent.
Analysts polled by Reuters had forecast retail sales rising 0.3 percent last month. Compared to August last year, sales were 3.6 percent higher.
“It suggests American consumers remain resilient despite the backdrop of high unemployment and declining home values. On the margin, this data reduces some concerns about a double-dip recession,” said Omer Esiner, chief market analyst at Commonwealth Foreign Exchange in Washington.
U.S. stock index futures turned positive after the report, while Treasury debt prices pared gains. The dollar briefly trimmed losses versus the yen.
Data so far for August, including private payrolls and manufacturing, have pointed to a tentative improvement in the economy after a recent soft patch.
The recovery from the worst recession since the 1930s has cooled off as the boost from an $814 billion government stimulus package fades and unemployment remains stubbornly high.
The sagging economy has left the Democratic Party bracing for a backlash from voters unhappy with a 9.6 percent unemployment rate in November’s congressional elections.
Polls suggest the Republicans could take the House of Representatives and perhaps even the Senate in the November 2 vote, which would put them in position to determine any new economy-boosting initiatives.
Last month, motor vehicle and parts purchases fell 0.7 percent after increasing 1.0 percent in July. Excluding autos, sales increased by a bigger-than-expected 0.6 percent in August, also the largest increase since March, after a 0.1 percent gain the prior month. Markets had expected sales excluding autos to increase 0.3 percent in August.
Receipts at gasoline stations increased 1.9 percent after rising 2.2 percent in July. Building materials and garden equipment sales were unchanged after falling 0.4 percent in July, suggesting some stability after sharp declines following the end in April of a popular homebuyer tax credit.
Clothing and clothing accessories sales increased 1.2 percent.
Core retail sales, which exclude autos, gasoline and building materials, rose 0.5 percent after dipping 0.1 percent in July. Core sales correspond most closely with the consumer spending component of the government’s gross domestic product report.
Receipts at sporting goods, hobby and book stores rebounded 0.9 percent last month. Purchases at electronics and appliance stores fell 1.1 percent.
(Reporting by Lucia Mutikani; Additional reporting by Vivianne Rodrigues in New York; Editing by Andrea Ricci)