U.S. retail sales rose less than
forecast in August and consumer confidence waned this month,
raising investor concern that consumers may not be able to
maintain their spending.
Retailers’ sales increased 0.6 percent, less than the 1.5
percent median economist forecast, as auto dealers offered rebates
and building-material purchases fell for the first time since
February, the Commerce Department said in Washington.
U.S. Treasury notes surged, sending yields to their lowest
since July, as bond investors bet the data will make the Federal
Reserve less likely to raise interest rates anytime soon. Central
bankers meet on Tuesday.
“Households are really spreading the wealth around,” said
Joel Naroff, president of Naroff Economic Advisors in Holland,
Pennsylvania. “But don’t count on the consumer to continue to
continue to spend with abandon. Job growth remains non-existent
and the refinance funds source is disappearing.”
The value of auto dealer sales rose less than in July even as
industry figures showed a 10 percent rise in vehicle deliveries.
Extra cash from tax cuts and mortgage refinancing is making
purchases easier, while higher fuel prices and a lack of jobs are
eroding optimism.
The University of Michigan’s index of consumer sentiment
unexpectedly fell to 88.2 this month from 89.3. It was the third
decline in four months. Confidence is faltering because the
economy isn’t creating jobs, economists said. Almost 600,000 U.S.
workers lost jobs over the past seven months. Also, the price
gasoline rose to a record in August.
Bloomberg News
