The index for final demand goods moved down 1.2% percent in September, the largest decrease since a 1.9% drop in January. Compared to last September, sales were down 19.7%.
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Sales at gas stations fell as expected, down 3.2%, because of lower prices at the pump.
Excluding motor vehicles, retail and food sales were down 0.3 per cent in September.
Disappointing USA retail sales have all but closed the door on a possible interest rate rise this year, as concerns over the health of the world economy have grown.
Sean/FlickrRetail sales rose 0.1% in September, according to the Census Bureau.
The Commerce Department said on Wednesday the unchanged reading in August’s inventories followed a downward revision to July’s data. Market expectations going into the report were for a slightly stronger September increase of 0.2%. Excluding petrol, they rose 0.4%. In addition, weaker sales data would come “in the wake of sluggish employment reports the past two months and softening in a few consumer confidence gauges”, he said.
August trade data published last week suggested GDP growth slowed significantly in the third quarter, with estimates now running below a 2 per cent rate. Most economists expect the Fed will raise its benchmark overnight interest rate in December, but financial markets are only pricing in an increase early next year. The NRF added that the three-month moving average growth on an annual basis for its calculated retail sales is 3.4 percent.
The weak inflation environment is one of the obstacles confronting policymakers who are contemplating raising rates for the first time in almost a decade.
E-commerce sales declined, as did sales at general-merchandise stores, home centers, grocery stores, and appliances and electronics stores.
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“Consumption has been a strong pillar of growth over the summer, but this pillar is probably more fragile than previously expected”, said Thomas Costerg, a senior USA economist at Standard Chartered Bank in New York. The median forecast of 82 economists surveyed by Bloomberg called for a 0.2 percent advance. Receipts at building materials and garden equipment stores fell 0.3 per cent, while sales at furniture stores rose 0.6 per cent.
