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NEWS

Retail Sales Ease Recession Fears (Tuesday, September 14, 2010)

Largest month-to-month increase in five months

Retail sales rose 0.4 percent in August, the largest month-to-month increase in five months, the Commerce Department said in a report interpreted as a sign the economy is wobbly but regaining momentum.

Excluding a decline in auto sales, retail sales increased 0.6 percent ¨C double the median increase economists had forecast in a Bloomberg News survey.

The strength came in a number of areas from department stores to clothing stores and sporting goods outlets. Eight of 13 major categories showed increases last month, led by grocery stores and service stations.

The retail sales report was in line with data over the past two weeks indicating the economy, while still weak, is growing slightly faster than economists expected.

Retail sales are watched closely in the transportation and logistics industry. Consumer spending accounts for 70 percent of U.S. GDP and a large portion of containerized imports and domestic intermodal and trucking volume.

PIERS Global Intelligence Solutions, a sister company of The Journal of Commerce, has forecast that growth in imports will slow later this year from the double-digit growth during the year¡¯s first half, largely because of consumer skittishness about unemployment and housing prices.

Through the first eight months of this year, the Commerce Department reported retail sales up 6 percent overall and 5.6 percent excluding autos and parts.