U.S. retail sales fell further in December as measures were renewed to curb the spread of COVID-19 spending on restaurants and reduced traffic in shopping malls, the latest sign that the economy lost considerable speed in late 2020.
Retail sales fell 0.7% last month, the Commerce Department said Friday. November data was revised downward to show sales declining 1.4% instead of 1.1%, as previously reported. Economists surveyed by Reuters had forecast retail sales unchanged in December.
Excluding cars, gasoline, building materials and food services, retail sales fell 1.9% last month after a revised downward decline of 1.1% in November . These so-called basic retail sales are more in line with the consumer spending component of gross domestic product. Previously, it was estimated that they had decreased by 0.5% in November.
The report followed last week’s news that the economy launched jobs in December for the first time in eight months. Other job losses are likely to occur in January, as new applications for unemployment benefits increased in the first week of the month. The data coincides with economists ’expectations of a sharp slowdown in economic growth in the fourth quarter.
Losses of economic momentum are behind rampant coronavirus infections and government delays in approving more money to help businesses and the unemployed. The government provided nearly $ 900 billion in additional pandemic relief in late December.
President-elect Joe Biden on Thursday unveiled a $ 1.9 trillion fiscal stimulus plan that includes strengthening the response to the virus and direct relief to households and small businesses. The proposed additional relief and accelerated vaccine deployment are expected to increase spending and the economy during the second half of 2021.
Growth estimates for the fourth quarter are around 5% annualized, largely reflecting inventory creation.
The economy grew at a rate of 33.4% in the third quarter after contracting at a rate of 31.4% in the April-June quarter, the deepest since the government began keeping records in 1947. .