Autos and Gas Raise Retail sales in January (13-02-2008)

WASHINGTON (MarketWatch) - The commerce department has unveiled the U.S. retail sales for January, which were better than expected due to a surprise gain in auto sales and the rising cost of gasoline.

Retail sales rose 0.3 % in January after declining by 0.4% in December; however they were flat if autos and gas are taken out of the equation.

Economists expected a slightly larger 0.3% decline in January sales. They thought sales excluding autos would rise 0.3%.

Over the period of the past 12 months, retail sales have risen by 3.9%.

Gasoline station sales rose 2.0% in January after remaining unchanged in December. Excluding gasoline, retail sales rose 0.1%. Over the past year, gasoline sales are up 23%.

Motor vehicle sales rose 0.6% by dollar value. This is the biggest gain since September. Excluding autos, retail sales also rose 0.3%

Economists were surprised by the gain in auto sales. Car companies reported dreadfully slow rate of auto sales in January, with sales falling to an annual sales rate of just 15.3 million.

Retail sales represent about half of consumer spending, which in turn accounts for about two-thirds of final sales in the economy.

Retail sales in the past three months are up 0.2% compared with a 0.3% rise in the previous three months.

Source: MarketWatch