Retail sales surge, unemployment down

Filed under: Retail |

Retail sales surged by 1.2 percent last month, almost two times the increase that analysts had predicted, to reach the largest gain in six months, according to a Commerce Department report released today.

The surge comes after a 0.2 percent rise in retail sales during October.

Nearly half of the November increase came from a hike in gasoline prices and so was not considered to be an indication of consumer demand.

Also, wholesale prices shot up by 3.2 percent during November, the biggest increase in 34 years.

Applications filed last week for unemployment benefits dropped by 7,000 to 333,000 – the lowest level since the middle of November.

Excluding gasoline, retail sales would have been up by 0.6 percent. This strength reflected a gain of 0.9 percent at department stores and general merchandise stores such as Wal-Mart and Target and a solid increase of 2.6 percent at specialty clothing stores. Analysts said colder weather in November and heavy promotional efforts in the period following Thanksgiving helped lift this total.

Retail sales also posted strong increases at appliance stores, furniture stores, sporting goods stores and grocery stores. Sales were down, however, for autos, which fell by 1 percent after a 0.6 percent drop in October. Domestic automakers have been struggling with weak demand in the face of surging gas prices.