Sales at U.S. retailers rose in July on growing demand for everything from cars to clothing, and a decline the previous month was wiped away, signaling consumers are propelling growth in the world’s largest economy.
The 0.6 percent advance matched the median forecast of economists surveyed by Bloomberg and followed little change in June that was previously reported as a 0.3 percent drop, a Commerce Department report showed Thursday in Washington. Eleven of 13 major categories showed gains.
Rising employment, stronger finances and still-cheap fuel is helping draw consumers into stores and auto dealerships. Growth in household spending, which accounts for about 70 percent of the economy, is bolstering the expansion as Federal Reserve policy makers move toward lifting interest rates this year for the first time since 2006.
“The consumer is in good shape,” Brian Jones, a senior U.S. economist at Societe Generale in New York, said before the report. “We have a vibrant labor market and the unemployment rate continues to move lower. The outlook for third-quarter spending is pretty decent.”
Estimates in the Bloomberg survey of 84 economists for total retail sales ranged from gains of 0.1 percent to 1 percent.
A report from the Labor Department showed applications for unemployment benefits last week hovered close to a four-decade low, a sign firings remain muted as the job market firms. While jobless claims climbed by 5,000 to 274,000 in the period ended Aug. 8, they remain close to the 255,000 reached a month ago that was the lowest since 1973.