Retail sales in the United States fell in September, with new auto sales responsible for much of the drop. Prices at the wholesale level held steady.

The U.S. Commerce Department reported on Friday a 1.2% decline for retail sales in September, the largest monthly drop since November 2001. Sales for the previous month were revised slightly downward from their original estimates.
Excluding autos, retail sales for the month managed a modest 0.1% gain.
Newport Communications Senior Economist Jim Haughey says the 4.8% decline in auto sales is not a trend, noting some manufacturers were slow in extending their huge discounts to 2003 models, and dealers" inventories were low, which postponed some sales.
"Most soft goods retail categories had marginal month-to-month sales declines," said Haughey. "But with prices recently falling for food and apparel, unit volume and freight may not have declined."
He noted a 1.7% sales increase for building materials offset the lower sales at the malls.
According to Haughey, summer quarter sales increased 2% from the spring quarter, translating into a more than 8% annual rate. This assures a larger gain in consumer spending that should be reflected when figures on the gross domestic product for the third quarter are released later this month.
"Slower growth in consumer spending is expected in the current quarter," he said. "October began with the sales pace 0.6% below the third quarter average. Some purchases will not be made because the West Coast port shutdown made goods unavailable. More importantly, the resulting layoffs will cut income and spending. And we know from the early 1990s that the prospect of war makes consumers cautions about spending."
Meantime on Friday the Labor Department released figures on wholesale prices that indicated the Producer Price Index increased only 0.1% in August even through energy prices increased 0.9%. The index has declined 0.1% in the last three months and 1.9% since last September.
Haughey said the effect of the PPI for trucking companies is that it creates a tough economic environment in which to request a price increase. However, he noted the tame inflation rate does permit the Federal Reserve Board to delay the inevitable increase in interest rates with an expanding economy.
Heavy Duty Trucking magazine's less-than-truckload rate index rose 1.4% in September following a similar gain in August.
"Fuel price adjustment clauses account for a small share of the recent gain, but most of it appears to be due to a tightening freight market," said Haughey. "LTL rates have increased 7.6% since their low point in the 2001 recession."
He noted the weaker truckload market recorded a small 0.2% rate gain, matching the August increase. Truckload rates have now recovered a little more than a third of their 2% fall from last September through March.
The Commerce Department also reported sales at the wholesale level increased 0.9% in August, following a 0.7% increase the month before, while wholesale inventories moved up 0.2% following a 0.6% increase in July.