Consumers Kept Sales Strong During November
WASHINGTON -- Retail sales continued to grow briskly in November, easing concerns that U.S. consumers, who have underpinned global growth recently, are hunkering down.</br></br>Still, it is too early to tell whether holiday sales will remain strong, as more recent chain-store reports have been less robust. Consumer spending depends on employment, and a jump in new claims for unemployment insurance last week, though muddied by measurement difficulties, suggests the job market remains a weak spot. And the current-account deficit -- the broadest gauge of the nation's global trade -- continued to reflect Americans' huge appetite for foreign-made goods, remaining essentially unchanged from the second quarter at a steep $127 billion.</br></br>Retail sales rose 0.4% in November from October, the U.S. Commerce Department reported yesterday, a significant acceleration from October's 0.1% increase. Excluding auto sales, which have weakened from their incentives-charged summer pace, retail sales rose an even more encouraging 0.5% in November, though that was off from October's 0.8% pace.</br></br>The data suggest this "holiday retail season will outperform early dour expectations," said Susan Polatz, an economist at Banc of America Securities. Consumer spending is being helped by the continued rise in inflation-adjusted after-tax income and by mortgage refinancing, she said.</br></br>Sales were especially strong for furniture, up 2.3%; building materials, up 1.2%; and electronics and appliances, up 0.9%. "People appear to finally be furnishing all the homes they have been buying," said Lehman Brothers economist Drew Matus. But clothing sales sank 1.3%, corroborating weak reports from many store chains. That suggests it is too early to assess the strength of holiday sales. A late Thanksgiving may have pushed some sales that normally occur in November into December.