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U.S. Retail Sales Rose Slightly in August



WASHINGTON – American consumers held back their spending in August, pausing after a strong sales growth in July.

Sales in stores and restaurants have risen 0.1% from the previous month to $ 509 billion seasonally adjusted in August, the Commerce Department said.

This was well below the 0.4% increase in economists interviewed by The Wall Street Journal expected. Sales rose by 6.6% compared to August a year earlier.

Again, the revised data showed that retail sales increased by 0.7% in July, compared to an increase of 0.5% initially reported.

"Smooth through monthly rotations, retail sales fluctuate," said Stephen Stanley, chief economist at Amherst Pierpont Securities, in a well-known analyst.

The general weakness of August was largely due to a decline in car sales. Sales of motor vehicles and spare parts dealers decreased by 0.8% compared to the previous month.

Excluding motor vehicles, sales increased by 0.3% in August and, excluding gasoline, sales decreased by 0.1

%. Excluding both categories, sales increased by 0.2% last month.

Consumer spending is a key factor of the US economy, which accounts for about two-thirds of economic output.

Spending in grocery stores was flat during the month and Americans increased their spending in bars and restaurants only slightly, by 0.2%.

Gas prices for US drivers averaged $ 2.84 per gallon in August, down 1 cent from July, according to the US Energy Information Administration, and consumers spend more on service stations. In August, sales at service stations increased by 1.7% and increased by 20.3% compared to the previous year.

Retail sales data can be volatile for a month at a time. Sales in department stores fell by 1% in August and sales in clothing stores fell by 1.7%.

Sales at non-store resellers, such as purchases made online or from mail order catalogs, increased by 0.7% and increased by 10.4% compared to August last year.

Online sales helped push retailers in the second quarter, which was characterized by strong consumer spending.

Walmart

Target
Corp.

,

Home Depot
Inc.

is

Nordstrom
Inc.

all recorded strong sales for the quarter.

One of the last major retailers to report gains,

Kroger
Co.

, said Thursday its sales have grown less than expected in its last quarter. The largest US supermarket chain in stores and sales said it would sacrifice profit to continue investing in online ordering and other services to compete with

Amazon.com
Inc.

and Walmart Inc.

"We are making those investments and they are substantial and significant," said Kroger CEO Rodney McMullen in an interview about digital competition.

The Department of Commerce report on Friday suggests that consumer spending continued to be strong at the start of the third quarter, but may have cooled slightly, and the hurricane that landed on the coast of the North Carolina at the beginning of Friday could confuse retail sales data.

"The Florence hurricane could distort the September numbers, with early storm purchases, declining sales in the immediate future, and then gains again during the recovery phase," he said Gus Faucher, chief economist at PNC Financial Services Group, in a note to customers.

The Federal Reserve closely observes consumer spending data as an indicator of economic growth, and Fed officials have indicated a resumption of consumer spending as a factor in their decision to raise interest rates in June at an interval between 1.75% and 2%. It is widely expected that rates will increase by a quarter of a percentage point again at the end of this month.

Write to Harriet Torry at harriet.torry@wsj.com


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