A woman carries Nike shopping bags at the Citadel Outlet Mall as the worldwide outbreak of coronavirus (COVID-19) in Commerce, California, continues December 3, 2020.
Lucy Nicholson | Reuters
U.S. retail sales declined further in December as renewed measures slowed the spread of COVID-19 spending at restaurants, reducing traffic to shopping malls.
Retail sales fell 0.7% last month, the Department of Commerce said Friday. The data for November were revised to show that sales decreased by 1.4% instead of 1.1% as previously reported. Economists polled by Reuters predicted retail sales in December.
With the exclusion of cars, petrol, building materials and food services, retail sales tumbled 1.9% last month after a downward revised decline of 1.1% in November. These so-called core retail sales best correspond to the consumer spending component of the gross domestic product. It was previously estimated that they decreased by 0.5% in November.
The report follows last week’s news that the economy shook off jobs for the first time in eight months in December. Further job losses are likely in January, as new unemployment benefit applications rose in the first week of the month. The data is in line with economists’ expectations for a sharp slowdown in economic growth in the fourth quarter.
Revealing coronavirus infections and delays by the government in approving more money to help businesses and the unemployed are behind the loss of economic momentum. The government provided nearly $ 900 billion in additional pandemic relief by the end of December.
President-elect Joe Biden on Thursday unveiled a $ 1.9 billion fiscal stimulus plan that includes promoting the response to the virus and direct relief for households and small businesses. The proposed additional relief and acceleration of vaccine deployment is expected to boost spending and the economy in the second half of 2021.
Growth compositions for the fourth quarter are approximately an annual rate of 5%, which mainly shows an inventory build-up.
The economy grew at a 33.4% rate in the third quarter after shrinking at a rate of 31.4% in the April-June quarter, the deepest since the government began keeping records in 1947.