November’s retail sales confounded doomsayers, surging 1.2%, twice the 0.6% analysts predicted, Bloomberg reports. Many had worried that consumer spending would take a hit as gas rose and housing fell, but now it looks like job and income growth could cushion the fall. “The numbers should help put to rest some of the fears of sliding into recession,” said one economist.
The news also vindicates the Federal Reserve’s mere quarter-point rate reduction. Only automobile dealers saw a sales dip, while gas stations saw the greatest uptick, possibly reflecting higher prices. But there are signs that consumers are slowing down in December, with sales dropping for the second straight week. The National Retail Federation has predicted the weakest holiday season since 2002.