Retail Sales Barely Move Higher In January
February 14, 2013
Retail sales for the country started off in low gear during January, hitting their slowest pace in three months.
The U.S. Commerce Department this week reported a 0.1% increase from December’s level. Excluding sales of new autos, the increase was 0.2%. This follows a 0.5% gain in December compared to November.
For all of 2012, retail sales increased 4.1% last year versus 2011.
Some analysts were expecting January’s performance, blaming the expiration of a temporary cut in the Social Security tax that hiked the payroll deduction from 4.2% to 6.2% and took an estimated $9 billion dollars out of the economy. Adding to this, consumers were hit with higher fuel prices in January.
Consumer spending accounts for about 70% of all U.S. economic activity. This report, along with other recent ones, has many economists predicting slow growth for the U.S. economy this year of 2.3% compared to 2012, according to a poll by Reuters.