Retail sales slumped in September in the wake of the devastating attacks on New York City and Washington, posting their sharpest drop in at least nine years, the government said today.
Retail sales dropped 2.4 per cent overall, led by declines in the purchase of cars, building supplies and electronics. Excluding the car sector, sales were off by 1.6 per cent.
The US Commerce Department said the drops were the largest since the government began compiling retail data in its current form in February 1992.
The data are likely to fan fears that the US economy, already faltering before the assaults on the World Trade Center and the Pentagon, has tipped into recession. Analysts had expected consumer spending, which makes up two-thirds of economic activity, to have taken a hit as Americans stayed indoors in the wake of the attacks. But the September numbers are worse than expected.
Analysts surveyed by Reuters had expected sales to fall by 0.8 per cent overall and by 0.6 per cent excluding the auto sector.
Meanwhile higher costs for gasoline and home heating oil helped push US wholesale prices up at a faster-than-expected clip last month, the US Labor Department said today, though falling prices for imported oil since the September 11th attacks may rein the jumps in coming months.
The Producer Price Index - a measure of costs at the factory door and the farm gate - climbed 0.4 per cent in September, matching August's rise and well ahead of Wall Street economists' forecasts for a slim 0.1 per cent gain. Excluding food and energy products, the socalled core rate, watched closely by the Federal Reserve as a gauge of underlying pressures, was ahead 0.3 percent in September after falling 0.1 per cent in August.
Reuters