WASHINGTON (Reuters) – U.S. retail sales were flat in September, official statistics showed on Friday, as high inflation and rapidly rising rates dampen demand for goods.
Economists polled by Reuters on average forecast a 0.2% rise in September.
Retail sales for August have been revised upwards and now show an increase of 0.4%, against +0.3% previously announced, announced the Commerce Department.
Sales are also slowing as spending shifts to services. Retail sales, which mainly consist of goods, are not adjusted for inflation.
Soaring rents and health care are squeezing the budgets of many Americans, leading to reduced spending on goods. The situation is aggravated by rising borrowing costs.
The Federal Reserve raised the federal funds rate target to 3.00%-3.25%, its highest level since 2008, in a bid to combat rising prices. A fourth straight rate hike of 75 basis points next month is widely expected by markets after the latest inflation data.
Excluding automobiles, fuels, building materials and food services, retail sales increased by 0.4% in September after +0.2% in August.
This category is the closest to that used for the calculation of the consumption component in the gross domestic product (GDP) statistics.
(Report Lucia Mutikani, French version Laetitia Volga, edited by Sophie Louet)