Retail sales unexpectedly rise; jobless claims fall
STORY: U.S. retail sales unexpectedly rebounded in August as Americans ramped up automobile purchases and dined out more amid lower gasoline prices.
Retail sales increased 0.3% last month... Economists had expected the number to be unchanged following a drop in July.
Receipts at auto dealerships were up almost 3%, while sales at clothing and general merchandise stores also increased solidly, likely boosted by back-to-school shopping.
Economists said the stronger than expected report showed consumers’ resilience – even in the face of stubbornly high inflation - likely helped by the strong job market.
Despite the hand wringing about a possible recession next year due to higher borrowing costs, there has not been a surge in layoffs.
A report from the Labor Department on Thursday showed initial claims for state unemployment benefits for the week ended Sept. 10 fell to the lowest level since the end of May.
And as of the end of July, there were 11.2 million job openings in the U.S. – or two jobs for every unemployed person.
Strong retail sales and continued strength in the labor market – along with a surprise increase in inflation in August - are likely to give the U.S. central bank plenty of reasons to continue its fight against inflation and deliver a third consecutive 75-basis-point interest rate hike next Wednesday… which is expected to cool economic activity.
