U.S. retail sales tumble in December amid shortages
U.S. retail sales dropped by the most in 10 months in December, weighed down by shortages and spiraling COVID-19 infections, which could temper expectations that economic growth accelerated sharply in the fourth quarter.
Americans started their holiday shopping in October to avoid empty shelves, which pulled sales away from December. Sales could weaken further in January as raging coronavirus infections, driven by the Omicron variant, limit consumer traffic to places like restaurants and bars.
"The weakness in December was likely more about the timing of spending than the level," said Scott Hoyt, a senior economist at Moody's Analytics in West Chester, Pennsylvania. "Support is coming from job and income growth which is strong by pre-pandemic standards and abundant cash and available credit for many consumers."
Retail sales dropped 1.9% last month, the largest decline since February 2021, after rising 0.2% in November, the Commerce Department said on Friday. Economists polled by Reuters had forecast retail sales unchanged. Estimates ranged from as low as a drop of 2.0% to as high as a 0.8% increase.