Relentless US shoppers packed the malls in October in a scramble for winter clothes, government figures showed Thursday, sparking new hope for a recovery.
Retail sales, which had been expected to tumble as automobile manufacturers reported a slump in car sales, held steady in the month as the clothes-buying spree began.
"Don't count the consumer out yet," said Naroff Economic Advisors chief economist Joel Naroff. "There still seems to be a little bounce in the mall walk."
Flat retail sales in October were not the real story, he said, since the drop in vehicle sales had already been expected.
People deserted car showrooms, which had been packed for months as automobile manufacturers offered zero-percent interest financing to move cars out of their lots.
Auto sales dropped 1.9 percent after slumping 5.0 percent in September.
Excluding auto sales, however, retail sales climbed 0.7 percent in October, the steepest rise in six months.
Sales in clothing stores shot up 4 percent in October, the sharpest climb this year, as cold weather spurred buying. Gasoline sales rose 1.5 percent. Department stores reported a 1.1-percent gain in sales.
"The strength in ex-autos was quite broadly based and suggests that the American consumer is alive and well," said Sal Guatieri, Chicago-based economist at Bank of Montreal.
"There was some fear given the plunge in October auto sales that the American consumer was collapsing under the weight of rising debt loads and weak jobs growth," he said.
"This report goes some ways to alleviating our concerns about the health of the consumer," he added.
Wall Street advanced as investors greeted the figures.
The Dow Jones industrials average of 30 top stocks rose 143.64 points, or 1.71 percent, to close at 8,542.13.
The retail sales data indicated slow but still-growing personal consumption in the October-December quarter, Guatieri said, anchoring his forecast for annual economic growth of about 1.5 percent in the same period.
Latest jobs data also kept hopes alive.
The number of people making new claims for US unemployment benefits dropped 8,000 to a seasonally adjusted 388,000 last week, the Labor Department said.
Wall Street economists had been expecting a small increase in unemployment claims.
"The improvement in jobless claims as well helped alleviate concerns about the health of the American consumer," Guatieri said.
"We definitely need to see a pick-up in jobs growth to sustain consumer spending at health rates and this report at least moves in that direction," he said.
US Federal Reserve chairman Alan Greenspan, who last week joined with his colleagues in slashing key interest rates by half a percentage point, said Wednesday the economy had hit a "soft patch."
"There is no evidence here that the economy's soft patch has gotten softer," said a report by Bear Stearns economists.
"We continue to stick to our forecasts of 2.0 to 2.25 percent real GDP [gross domestic product] growth in the fourth quarter."
SECURITY: As China is ‘reshaping’ Hong Kong’s population, Taiwan must raise the eligibility threshold for applications from Hong Kongers, Chiu Chui-cheng said When Hong Kong and Macau citizens apply for residency in Taiwan, it would be under a new category that includes a “national security observation period,” Mainland Affairs Council (MAC) Minister Chiu Chui-cheng (邱垂正) said yesterday. President William Lai (賴清德) on March 13 announced 17 strategies to counter China’s aggression toward Taiwan, including incorporating national security considerations into the review process for residency applications from Hong Kong and Macau citizens. The situation in Hong Kong is constantly changing, Chiu said to media yesterday on the sidelines of the Taipei Technology Run hosted by the Taipei Neihu Technology Park Development Association. With
CARROT AND STICK: While unrelenting in its military threats, China attracted nearly 40,000 Taiwanese to over 400 business events last year Nearly 40,000 Taiwanese last year joined industry events in China, such as conferences and trade fairs, supported by the Chinese government, a study showed yesterday, as Beijing ramps up a charm offensive toward Taipei alongside military pressure. China has long taken a carrot-and-stick approach to Taiwan, threatening it with the prospect of military action while reaching out to those it believes are amenable to Beijing’s point of view. Taiwanese security officials are wary of what they see as Beijing’s influence campaigns to sway public opinion after Taipei and Beijing gradually resumed travel links halted by the COVID-19 pandemic, but the scale of
A US Marine Corps regiment equipped with Naval Strike Missiles (NSM) is set to participate in the upcoming Balikatan 25 exercise in the Luzon Strait, marking the system’s first-ever deployment in the Philippines. US and Philippine officials have separately confirmed that the Navy Marine Expeditionary Ship Interdiction System (NMESIS) — the mobile launch platform for the Naval Strike Missile — would take part in the joint exercise. The missiles are being deployed to “a strategic first island chain chokepoint” in the waters between Taiwan proper and the Philippines, US-based Naval News reported. “The Luzon Strait and Bashi Channel represent a critical access
Pope Francis is be laid to rest on Saturday after lying in state for three days in St Peter’s Basilica, where the faithful are expected to flock to pay their respects to history’s first Latin American pontiff. The cardinals met yesterday in the Vatican’s synod hall to chart the next steps before a conclave begins to choose Francis’ successor, as condolences poured in from around the world. According to current norms, the conclave must begin between May 5 and 10. The cardinals set the funeral for Saturday at 10am in St Peter’s Square, to be celebrated by the dean of the College