Skip to main content

A file photo of shoppers paying for merchandise at the Macy's department store in New York.

MIKE SEGAR/REUTERS

U.S. retail sales barely rose in January as tax increases and higher gasoline prices restrained spending, suggesting a slowdown in the pace of consumer spending early in the first quarter.

The Commerce Department said on Wednesday retail sales edged up 0.1 per cent after an unrevised 0.5-per-cent rise in December.

The modest gain, which was in line with economist's expectations, suggested that households were responding to the expiration of a 2 per cent payroll tax cut on Jan. 1. Taxes also went up for wealthy Americans.

Story continues below advertisement

So-called core sales, which strip out automobiles, gasoline and building materials and correspond most closely with the consumer spending component of gross domestic product, ticked up 0.1 per cent after gaining 0.7 per cent in December.

Consumer spending accounts for about 70 per cent of the U.S. economy and grew at a 2.2 per cent annual rate in the fourth quarter. The pace is expected to slow this quarter as households adjust to smaller paycheques and higher gasoline prices.

Sales were mixed last month, with receipts at auto dealers slipping 0.1 per cent after rising 1.2 per cent in December. Excluding autos, retail sales increased 0.2 per cent last month after advancing 0.3 per cent in December.

Sales at building materials and garden equipment suppliers rose 0.3 per cent, reflecting gains in homebuilding as the housing market recovery shifts into higher gear. Receipts at clothing stores fell 0.3 per cent.

Sales at restaurants and bars were flat, while receipts at sporting goods, hobby, book and music stores rose 0.6 per cent. Sales of electronics and appliances gained 0.2 per cent, while receipts at furniture stores fell 0.2 per cent.

Report an error
Due to technical reasons, we have temporarily removed commenting from our articles. We hope to have this fixed soon. Thank you for your patience. If you are looking to give feedback on our new site, please send it along to feedback@globeandmail.com. If you want to write a letter to the editor, please forward to letters@globeandmail.com.

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff.

We aim to create a safe and valuable space for discussion and debate. That means:

  • Treat others as you wish to be treated
  • Criticize ideas, not people
  • Stay on topic
  • Avoid the use of toxic and offensive language
  • Flag bad behaviour

Comments that violate our community guidelines will be removed.

Read our community guidelines here

Discussion loading ...

Cannabis pro newsletter
To view this site properly, enable cookies in your browser. Read our privacy policy to learn more.
How to enable cookies