Despite a troubling headline number, retail sales were surprisingly strong in January, and not as bad as previously thought over the holidays, the government said Thursday.
Overall retail sales fell 0.9% last month, according to the Commerce Department, but the decline was due entirely to a dropoff in the sale of cars and trucks. Excluding those, sales jumped 1.3% in January, their best performance in about two years and provided more evidence that the economy is not in quite the straits some pundits have speculated.
The Commerce Department also upwardly revised December's retail sales growth to 2% from 1.2%, a fairly significant restatement given that the original number was widely cited as indicating that the 2002 holiday shopping season was among the worst ever.
Part of the increase in January sales was higher gas prices, certainly not a reason for economic cheer. But the report also showed solid gains in the sale of construction materials, food and beverages, and books, movies and sporting goods. By contrast, sales at car and parts fell 7.5%, all but wiping out their 7.9% gain the month before.