U.S. household spending fell back in January, as higher fuel prices were outweighed by lower car sales and a drop in the sale of building supplies and garden items. According to the latest advance U.S. retail sales numbers released by the U.S. Census Bureau, retail sales shrank by 0.3% for the month. The decline is well below the expected figure of +0.2% and lower than December’s revised figure of 0.0%. On a yearly basis, the increase was 3.6%, down from December’s comparable figure of 5.2%.
“Non-store retailer” sales, which includes online transactions as well as direct selling and other forms of electronic commerce, remained almost unchanged from December. However, this segment still grew by 10.2% over the last 12 months and it remains the fastest-growing of all segments.
ANZ senior economist Felicity Emmett said the result may be a sign U.S. households are facing pressures. “The combination of higher wage growth and declining consumption momentum may suggest the fall in the savings rate, rise in credit, and interest rates could be starting to pinch households a bit. The data are volatile, however we are keeping a close eye on the consumer with saving rates so low.”