Retail Sales Continued Growth in December
U.S. retail sales increased for a second straight month in December and inflation remained tame for holiday shoppers. The labor market improved last week, with the second-lowest number of initial jobless claims in three years.</br></br>Retail sales rose 0.5 percent from the previous month to $325 billion after a revised 1.2 percent increase in November, which was the highest since July, the Commerce Department said. Consumer prices edged up 0.2 percent in December, capping a year in which costs excluding food and energy rose by 1.1 percent, the smallest increase in 43 years.</br></br>Increased demand has encouraged companies to keep more workers, helping push initial jobless claims down 11,000, to 343,000, last week. Since the recovery began in November 2001, the economy has shed 1.1 million jobs.</br></br>"What all this shows is that the economy is doing quite well and we're heading for a sizable amount of job creation," said Lyle E. Gramley, a former Federal Reserve governor who is now senior economic adviser at Charles Schwab Capital Markets LP in Washington. "I wouldn't be surprised if it turns out that job growth has been substantially more than has been reported."</br></br>Holiday season sales of clothing, books, music, furniture and other general merchandise increased 5.2 percent to $216.3 billion in November and December, from $205.6 billion a year ago, the National Retail Federation trade group said yesterday.