Spending at retail stores fell in December by the most in a year as consumer demand cools in the face of stubbornly high inflation and rising interest rates.
Retail sales, a measure of how much consumers spent on a number of everyday goods, including cars, food and gasoline, declined 1.1% in December, the Commerce Department said Thursday. Economists surveyed by Refinitiv expected sales to fall 0.8%.
“Plenty of excuses exist for why retail sales dropped so much in December, but the bottom line is consumers have become more prudent in their spending given lower savings and higher interest rates,” said Robert Frick, corporate economist with Navy Federal Credit Union. “For those reasons, consumer spending is expected to soften throughout this year.”
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