A better than forecast report on January retail sales indicates improved economic for the months ahead. Reports released by the Commerce Department Friday indicate a 0.5 percent gain in retail sales, exceeding predictions of 0.3 percent.
The majority of the increase was the result of heavier shopping at national chains such as Wal-mart. Sales at stores of its kind posted a higher than expected, 0.6 percent reading for last month.
Consumer spending accounts for roughly 70 percent of economic activity and has been creeping back slowly. Economists don’t believe the recent improvements though necessarily indicate a lasting move toward recovery. The crawling spending increases that began in the summer of 2009 are expected to wane as the job crisis rages on.
Strengthening the argument against rising retail sales as a key positive indicator are business' inventory reports. Companies cut stockpiles by 0.2 percent in December rather than boosting them by 0.2 percent as expected.
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