WASHINGTON Oct 14 U.S. retail sales rebounded
in September amid a surge in motor vehicle purchases and a rise
in discretionary spending, pointing to sustained domestic demand
that reinforces expectations of an interest rate increase from
the Federal Reserve in December.
The Commerce Department said on Friday retail sales
increased 0.6 percent after an upwardly revised 0.2 percent
decline in August. Retail sales in August were previously
reported to have decreased 0.3 percent.
Sales were up 2.7 percent from a year ago. Excluding
automobiles, gasoline, building materials and food services,
retail sales edged up 0.1 percent last month after an unrevised
0.1 percent drop in August.
These so-called core retail sales correspond most closely
with the consumer spending component of gross domestic product.
Economists had forecast overall retail sales increasing 0.6
percent and core sales advancing 0.4 percent last month.
The retail sales report added to upbeat data on the labor
market and manufacturing and services sector surveys that have
suggested economic growth regained speed in the third quarter
after a lackluster first half.
Minutes of the Fed's Sept. 20-21 policy meeting published on
Wednesday showed several officials believed it would be
appropriate to increase interest rates "relatively soon" if the
economy continued to gain strength.
The U.S. central bank raised its benchmark overnight
interest rate last December and has held it steady since,
largely because of concerns over low inflation.
The Atlanta Fed is currently forecasting the economy growing
at a 2.1 percent annualized rate in the third quarter after a
1.4 percent expansion pace in the second quarter.
Auto sales rose 1.1 percent last month after slipping 0.3
percent in August. Retail sales were also boosted by receipts at
service stations, which jumped 2.4 percent as gasoline prices
Sales at online retailers rose 0.3 percent. Sales at
restaurants and bars advanced 0.8 percent, the largest gain
since February, and receipts at sporting goods and hobby stores
surged 1.4 percent, pointing to healthy discretionary spending.
There were also strong increases in sales at furniture and
building material stores. But sales at electronics and appliance
outlets fell 0.9 percent and receipts at clothing stores were
(Reporting by Lucia Mutikani; Editing by Andrea Ricci)