US retail sales rose for 2nd month led by cars, clothes
FILE - In this Friday, Nov. 3, 2017, file photo, Jiahao Luo, left, and Jiahao Wang, from China, configure one of the four new Apple iPhone X's they purchased at the new Apple Michigan Avenue store along the Chicago River in Chicago. On Wednesday, Nov. 15, 2017, the Commerce Department releases U.S. retail sales data for October. (AP Photo/Charles Rex Arbogast, File)
November 15, 2017 - 6:07 AM
WASHINGTON - U.S. retail sales rose at a solid pace last month, as bullish consumers bought more cars, furniture and clothes.
Retail sales increased 0.2 per cent in October, the Commerce Department said Wednesday, after a healthy 1.9 per cent gain in the previous month. September's gain was the largest in 2 1/2 years and was driven by big increases in auto and gas sales in the wake of Hurricanes Harvey and Irma.
Americans are spending more freely as confidence in the economy has jumped in the past year and the unemployment rate is at a 17-year low. Excluding gas station sales, which fell sharply as prices dropped, retail sales rose 0.4 per cent last month.
Sales gains were widespread. Consumers spent more at electronics, grocery, clothing and sporting goods stores. Restaurants and bars reported a healthy 0.8 per cent increase, the biggest gain since January.
Americans are boosting their spending, but incomes are rising only modestly. That has pushed more people to borrow to finance their purchases, particularly of autos. That has renewed worried about whether U.S. households can stay on top of their burgeoning debt loads.
Auto loans and credit card debt rose sharply in the July-September quarter, according to a report Tuesday by the Federal Reserve Bank of New York. That pushed total household debt to a record high of nearly $13 trillion.
The proportion of Americans falling behind on their credit card bills rose to 4.6 per cent, the New York Fed said, up from 4.4 per cent a year earlier. The share of auto loans that are 90 days or more overdue rose to 2.4 per cent from 2.3 per cent. Still, low interest rates mean that U.S. households' debt payments, on average, aren't historically high.
Gas station sales fell 1.2 per cent last month, the retail sales report showed, mostly because prices nationwide dropped 2.4 per cent. That is a reversal from September, when gas prices spiked 13 per cent in the wake of the hurricanes, which disrupted refineries on the Gulf Coast.
Auto sales rose 0.7 per cent, a solid gain after a huge jump of 4.6 per cent in September. Sales are likely still elevated by the impact of the hurricanes, which destroyed thousands of cars in Texas and Florida that are steadily being replaced.
News from © The Associated Press, 2017