U.S. retail sales fell again last month, the third consecutive month of contraction, showing that the U.S. economy lost a lot of momentum in the recovery at the end of last year, mainly because of the resumption of the Newcastle pneumonia (CCP virus) epidemic blockade measures, resulting in less people spending in restaurants and less people in department stores. Although the producer price index (PPI) rose in the same month, the increase was less than expected, which also shows that the pressure of the epidemic on the economy is still there.
The U.S. Department of Commerce said on the 15th that retail sales fell 0.7% in December, not as flat as the market had expected. November data was also revised downward, with the contraction expanding to 1.4% from the previously announced 1.1%.
Excluding autos, gasoline, construction materials and food services, retail sales fell even more, down 1.9%, larger than the revised 1.1% decline in November. This figure is most closely related to the consumer spending component of gross domestic product (GDP).
The continued ravages of the new crown epidemic, the government’s delay in approving bailout grants to subsidize businesses, and the large number of unemployed people are the reasons for the weakening momentum of the U.S. economic recovery. The U.S. government issued nearly $900 billion in additional relief for the epidemic at the end of December last year.
Now, with the government likely to provide more financial support to the public, it will help bolster their financial situation, but retailers will continue to face daunting challenges in the coming months as the Newcastle pneumonia outbreak continues to worsen, unless more people are vaccinated against Newcastle and travel and leisure activities resume.
The U.S. nonfarm payrolls data released last week fell for the first time in eight months; this week’s release of last week’s initial jobless claims data increased, suggesting that more people may be out of work this month.
The December PPI, released on the same day, rose 0.3% month-over-month, an increase greater than November’s 0.1%, but less than the market’s expectations of 0.4%, an annual increase of 0.8%; excluding the volatile food and energy prices of the core PPI, up 0.1% month-over-month, also less than expected, compared with the same period a year earlier, climbed 1.2%.
The Department of Labor, which released the data, said that nearly half of the increase in PPI last month was driven by oil prices, with gasoline prices jumping 16.1% last month.
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