US retail sales plummet in December

WASHINGTON, Jan 14 (Reuters) – U.S. retail sales fell in December as Americans grappled with a shortage of goods and an explosion of COVID-19 infections, but that likely won’t change expectations for economic growth accelerates in the fourth quarter.

Retail sales fell 1.9% last month, after rising 0.2% in November, the Commerce Department reported on Friday.

Economists polled by Reuters had forecast that retail sales would remain unchanged. Estimates ranged from a decrease of 2.0% to an increase of 0.8%.

Bottlenecks in supply chains caused by the pandemic have led to shortages of goods, including motor vehicles. That caused consumers to start their Christmas shopping in October, hurting retail sales in December.

Advancing sales could also have affected the so-called seasonal factor, the model the government uses to eliminate seasonal fluctuations from the data.

Retail sales are mostly made up of goods, while services such as healthcare, education and hotel accommodation make up the remaining part of consumer spending. Restaurants and bars are the only service category in the retail sales report.

Sales could weaken further in January as the spiral of COVID-19 infections, driven by the omicron variant, limits the influx of consumers to places like restaurants and bars.

Excluding automobiles, gasoline, building materials and food services, retail sales fell 3.1%. November data was revised down to show that so-called underlying retail sales declined 0.5% instead of the previously reported 0.1%.

(Reporting by Lucia Mutikani; edited in Spanish by Carlos Serrano)