Retail sales fell in October as American consumers pulled back after a three-month shopping spree and Superstorm Sandy slammed into the East Coast, shutting malls and auto showrooms.
The 0.3 percent drop followed a 1.3 percent increase in September that was larger than previously reported, Commerce Department figures released on Nov. 14 showed. While it was able to collect information from the affected area, the agency said it couldn’t quantify the impact of the biggest Atlantic storm.
Companies such as General Motors Co. and Ford Motor Co. said last month’s storm-related sales slump will probably reverse as brighter job prospects, rising home prices and sturdier finances boost household confidence. At the same time, last week’s report showed Americans bought fewer nonessentials, which may reflect mounting concern over possible tax changes and limited wage growth that pose risks for the biggest part of the economy.
“Some of it is due to the hurricane taking away some discretionary sales,” said Jonathan Basile, director of U.S. economics at Credit Suisse in New York. “Spending still seems subpar, and consumers are facing headwinds on their paychecks and incomes.”
Other reports last week showed U.S. wholesale prices unexpectedly dropped in October and inventories climbed in September.
The decline in wholesale prices was led by falling fuel and vehicle costs. The producer-price index dropped 0.2 percent last month after rising 1.1 percent in September, according to Labor Department data.
The median forecast of 83 economists surveyed by Bloomberg for October retail sales called for a drop of 0.2 percent. Estimates ranged from a decline of 1.2 percent to an advance of 0.6 percent. The September reading was revised from an initially reported 1.1 percent gain.
Join PBN for the best networking event and party of the winter - January 15, 2015 - the Book of Lists Party at the Providence Public Library. Reserve your spot by December 31st and get a holiday gift from PBN!
PBN's annual Book of Lists has been an essential resource for the local business community for almost 30 years. The Book of Lists features a wealth of company rankings from a variety of fields and industries, including banking, health care, real estate, law, hospitality, education, not-for-profits, technology and many more.