Americans stepped up their spending even more than expected in December, according to the Associated Press, closing out the holiday season and the year on an upbeat tone.
Retail sales rose 0.6% in December, compared with November’s 0.3% increase, according to the Commerce Department’s report issued today. The report signaled that shoppers may be able to keep fueling economic growth this year.
Sales at stores selling general merchandise rose 1.3%, while sellers of clothing and accessories saw business up 1.5%. Online sellers posted a 1.5% uptick. Furniture and home furnishings businesses had a 1% decline, reflecting a challenging housing market. Sales at restaurants were unchanged in December.
Economists had expected consumers to pull back on spending in the final three months of the year as credit card debt and delinquencies rise and savings fall. While consumers continue to face higher borrowing costs, tighter credit conditions, and higher prices, spending is being fueled by a strong job market and rising wages.
The government’s monthly retail sales report offers only a partial look at consumer spending; it doesn’t include many services, including health care, travel, and hotel lodging.
