US retail growth grinds to halt in August after slow summer

 
Tim Wallace
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HURRICANE Irene and low confidence made retail and food sales stagnate last month, according to figures released yesterday by the US Census Bureau.

Advanced estimates indicate overall sales did not grow at all during August, compared to monthly growth of 0.3 per cent and 0.2 per cent in July and June respectively.

Sales of vehicles and clothing led the fall, declining by 0.3 per cent and 0.7 per cent respectively over the month. Electronics and sports goods helped offset that, however, with sales increasing by 0.5 per cent and 2.4 per cent in turn.

Economists believe sales postponed by the hurricane and a building expansion prompted by increased repair works will contribute to third quarter sales exceeding those in the second quarter.

Over the year so far sales are 7.9 per cent higher than in the same period of 2010, but a slow increase in business inventories – up 0.4 per cent in July, according to figures from the Commerce Department released yesterday – indicates firms are cautious about future demand.

The Producer Price Index (PPI) measure of inflation was also static, showing no change overall in August. Food prices rose 1.1 per cent over the month while energy declined by an almost identical one per cent.