Retail Sales Fall 0.4%, Hurt by GM Strike --- Despite Auto-Sector Drop, Outlays by Consumers Stay at Healthy Level
WASHINGTON -- The American shopper, the economy's chief engine these days, kept spending at a decent clip last month, though the General Motors Corp. strike damped overall retail sales.</br></br>Sales for all retailers fell 0.4% in July from June, adjusting for seasonal factors but not for inflation, the Commerce Department reported yesterday. That was the worst performance in more than a year, and reversed a modest 0.1% rise in June.</br></br>But the weakness was almost entirely at auto dealerships, which saw sales plunge 3% for the month, following a 0.6% rise in June. Analysts blamed the drop largely on the now-ended GM walkout: Excluding cars, retailers saw a decent 0.5% rise in business, more than making up for June's 0.1% decline in noncar sales.</br></br>Consumers' spending predilections have taken on a heightened importance in keeping the economic expansion going, as the Asian crisis has forced a slowdown in manufacturing and threatened to curb business investment. Despite daily news of Asia's deterioration, though, American consumer confidence remains high.</br></br>"The consumer is continuing to carry the load for the economy," said Joel Naroff, an economist at First Union Capital Markets Group in Philadelphia.