Sales at US retail stores strengthened broadly in July, the Commerce Department said yesterday, adding to signs the the US economy remained well-supported by hearty consumer spending. The total value of retail sales climbed a stronger-than-expected 0.7 per cent to a seasonally adjusted $248.69 billion (€234 billion) after a revised 0.2 per cent fall in June.

The July figure was more than double the 0.3 per cent increase forecast by Wall Street economists and was likely to fuel concerns that the Federal Reserve may raise interest rates again later this month.

"This is further confirmation that the economy does not appear to have started to slow down," Mr Thomas Riordan, money market portfolio manager at Dreyfus Corp. "So there's a real possibility that the Fed could raise interest rates by 25 basis points in August."