After disappointing manufacturing data, which showed a sixth consecutive month of contraction in the New York area, and a 0.5 decline in the Federal Reserve Bank of New York’s general economic index there was good news for the US.
Although economists forecast a 0.2 per cent increase in retail sales in the world’s largest economy Commerce Department figures show that they actually rose by 0.5 per cent.
This follows November’s 0.4 per cent increase and reaffirms that an improving labour market and income gains have bolstered consumer spending in recent weeks. Over 2012 retail sales advanced by 5.2 per cent. Whilst this figure is not as strong as 2011’s 7.9 per cent gain it isn’t as bad as could have been expected given last year’s Eurozone concerns, fiscal cliff worries and the economic impact of Superstorm Sandy.
A senior economist with Ameriprise Financial Inc. commented: ‘Consumers continue to spend at a decent pace. The payroll tax will have a modest impact on spending. We need faster job and income growth to allow the customer to shift into higher gear’.
Of the 13 major retail categories 9 showed gains. Sales at department stores and clothing chains climbed by 0.3 and 1 per cent respectively, while restaurant and bar sales increased 1.2 per cent. Meanwhile, furniture outlets saw a sales increase of 1.4 per cent and automobile dealers enjoyed a 1.6 per cent surge.
As of 15:00 pm
The Pound to Euro exchange rate is currently trading at 1.2029
The Pound to US Dollar exchange rate is currently trading at 1.6044
The Pound to Australian Dollar exchange rate is currently trading at 1.5219
The Euro to US Dollar exchange rate is currently trading at 1.3336
The Euro to Pound exchange rate is currently trading at 0.8314
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