US retail sales posted a surprise decline in January and claims for unemployment benefits rose in the latest week, according to government reports today showing the US economic recovery has stumbled.
The Commerce Department said retail sales - a major component of US consumer spending - fell 0.3 per cent to $322.87 billion in January, the first decline since September.
Excluding autos, however, retail sales posted a stronger-than-expected 0.9 per cent increase.
The Labor Department reported first-time claims for jobless benefits last week rose unexpectedly by 6,000 to 363,000.
Financial markets showed little initial reaction to the data, despite its divergence from Wall Street forecasts.
Wall Street had expected a more robust showing for overall spending. Analysts' forecasts had called for a flat reading on overall sales and a weaker 0.5 per cent increase for ex-auto sales. Claims had been expected lower at 345,000.
While autos were the main factor in bringing down overall sales, weakness was also seen in other categories. Motor vehicle sales dipped a sharp 3.9 per cent in January, their steepest decline since February 2003. Purchases at furniture
and building materials stores fell 0.9 per cent.
Buoyed by cold weather, clothing sales gained 2.9 per cent, their biggest gain since October 2002. Sales at grocery stores rose 1.8 per cent.