U.S. News: As Retail Sales Climb, Consumers Stay Glum
Retail sales rose in January as consumers bought more electronics and appliances, but a separate consumer-sentiment index fell in February, highlighting the mixed signals coming from the economy.</br></br>The revival of consumer spending is a key to a broad economic recovery, because consumer spending accounts for about two-thirds of all demand in the U.S. economy.</br></br>The Commerce Department said Friday that retail sales climbed a moderate 0.5% in January from December to a seasonally adjusted $355.8 billion. The government also revised upward the December number, noting that sales fell 0.1%, less than the 0.3% decline reported previously.</br></br>"Retail sales did pick up fairly nicely in January, and that certainly is a good story," said Millan Mulraine, a TD Securities analyst. "Clearly, we are not at the point where we believe consumer spending will drive the U.S. economic recovery . . . but we do think at some point down the road that's likely to be the case."</br></br>Consumers are still feeling the sting of job losses and the difficulty getting access to credit, which fueled much of household spending during the boom. But recent easing in job losses and improving credit conditions have helped Americans feel slightly more comfortable about spending.