09/17/2024

The U.S. Economy on Solid Ground

Retail sales surprise on the upside

In August, U.S. retail sales unexpectedly rose as a decline in receipts at auto dealerships was more than offset by strength in online purchases, suggesting that the economy remained on solid footing through much of the third quarter.

The report from the Commerce Department on Tuesday also showed retail sales were a bit stronger than initially thought in July. It combined with the decline in the unemployment rate last month to push against financial market expectations for a half-percentage-point interest rate cut from the Federal Reserve on Wednesday. U.S. central bank officials started a two-day policy meeting on Tuesday.

The Atlanta Fed raised its third-quarter GDP growth estimate to a 3.0 percent annualized rate from a 2.5 percent pace after the data. The economy grew at a 3.0 percent pace in the second quarter.

Please select this link to read the complete article from Reuters.