U.S. retail sales post biggest gain in six months
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[June 14, 2018]
WASHINGTON (Reuters) - U.S.
retail sales increased more than expected in May as consumers bought
motor vehicle and a range of other goods even as they paid more for
gasoline, the latest indication of an acceleration in economic growth in
the second quarter.
The Commerce Department said on Thursday retail sales jumped 0.8 percent
last month, the biggest advance since November 2017. Data for April was
revised up to show sales rising 0.4 percent instead of the previously
reported 0.2 percent gain.
Economists polled by Reuters had forecast retail sales rising 0.4
percent in May. Retail sales in May increased 5.9 percent from a year
ago.
Excluding automobiles, gasoline, building materials and food services,
retail sales increased 0.5 percent last month after an upwardly revised
0.6 percent increase in April. These so-called core retail sales
correspond most closely with the consumer spending component of gross
domestic product. They were previously reported to have risen 0.5
percent in April.

The Federal Reserve raised interest rates on Wednesday for the second
time this year. The U.S. central bank forecast two more rate hikes for
2018. The Fed said "economic activity has been rising at a solid rate"
and "growth of household spending has picked up."
The strong retail sales report added to data ranging from the labor
market to manufacturing and trade in suggesting the economy was
regaining momentum in the second quarter after growth slowed at the
start of the year amid a sharp step-down in consumer spending.
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People walk with shopping bags in Manhattan, New York City, U.S.
December 27, 2016. REUTERS/Andrew Kelly/File Photo

Growth estimates for the April-June quarter are as high as a 4.6 percent
annualized rate. The economy grew at a 2.2 percent rate in the first quarter.
In May, auto sales rose 0.5 percent after gaining 0.2 percent in April. Receipts
at service stations surged 2.0 percent, reflecting higher gasoline prices.
Prices at the pump have risen by 15.5 percent this year, according to U.S.
Energy Information Administration data. Expensive gasoline, if sustained, could
pull spending away from other categories.
Sales at building material stores rebounded 2.4 percent last month after
declining 0.8 percent in April. Receipts at clothing stores surged 1.3 percent,
the largest gain since March 2017. There were also increases in online retail
sales, but receipts at furniture stores fell 2.4 percent, the largest drop since
December 2013.
Sales at restaurants and bars jumped 1.3 percent, the biggest gains since
January 2017.
(Reporting by Lucia Mutikani; Editing by Andrea Ricci)
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