The Commerce Department said on Friday that the unchanged reading in sales last month followed an upwardly revised 0.4% increase in August. Sales in August were previously reported to have gained 0.3%.
Economists polled by Reuters had forecast sales climbing 0.2%, with estimates ranging from as low as a 1.1% decline to as high as a 0.8% increase.
Sales are slowing also as spending shifts back to services. Retail sales, which are mostly goods, are not adjusted for inflation.
Soaring costs for rents and healthcare are squeezing budgets for many Americans, leading to cutbacks on spending on goods. The situation has been compounded by higher borrowing costs, which are making credit more expensive.
The Federal Reserve has raised its policy rate from near-zero in March to the current range of 3.00% to 3.25% as it battles inflation. A fourth straight 75-basis-point interest rate hike is expected next month after data on Thursday showed inflation increasing strongly in September.
Excluding automobiles, gasoline, building materials and food services, retail sales increased 0.4% last month. Data for August was revised higher to show these so-called core retail sales rising 0.2% instead of being unchanged as previously reported.
Core retail sales correspond most closely with the consumer spending component of gross domestic product.
Economists estimate that growth in consumer spending was likely below a 1.0 annualized rate in the third quarter after increasing at a 2.0% pace in the April-June quarter.
Still, GDP is expected to have rebounded last quarter after two straight quarterly declines mostly as slowing domestic demand curbs imports and leaves a stockpile of unsold merchandise in warehouses.
The Atlanta Fed is estimating that GDP increased at a 2.9% rate last quarter after falling at a 0.6% pace in the second quarter. The government is scheduled to publish its snapshot of third-quarter GDP at the end of the month.
Source: Economy - investing.com
