A recent report from the Commerce Department has revealed a substantial decrease in U.S. retail sales during January, with the decline exceeding initial expectations.
The report indicated a drop in retail sales of 0.8 percent for January, following an upward revision of December's figures to a growth of 0.4 percent. This contrasted with economists' predictions of a marginal fall of 0.1 percent, as compared to December's initially reported rise of 0.6 percent.
FHN Financial's Chief Economist, Chris Low, attributed the larger than predicted drop to severe winter weather, suggesting that judgement be reserved until the release of February's results, regardless of January's significant fall.
A substantial part of the decline in retail sales reportedly resulted from a sharp drop in sales at motor vehicle and parts dealers, which saw a decrease of 1.7 percent, following a 0.3 percent rise in December.
Despite the plunge in car sales, January still saw a 0.6 percent drop in retail sales, following a 0.4 percent increase in December. This occurred even though ex-auto sales were predicted to grow by 0.2 percent.
The report highlighted substantial decreases in sales in several areas. This included a 4.1 percent drop at building material and garden equipment and supply dealers and a 3.0 percent fall at miscellaneous store retailers.
Likewise, significant decreases were noted in sales at gas stations and health and personal care stores. Conversely, furniture and home furnishings stores witnessed a jump in sales.
According to the report, core retail sales, which exclude the sales of automobiles, gasoline, building materials, and food services, fell by 0.4 percent in January. This follows a 0.6 percent rise in December.
