U.S. retail sales rebound sharply in January

According to foreign media reports, sales of US retailers such as Amazon and Best Buy jumped 3.8% in January as Americans bought more cars, furniture, consumer electronics, etc., which is a good sign for economic development. Previously, economists had predicted a 2.1% increase.

The sales increase was the biggest since March last year, when Americans spent a large chunk of government stimulus money, the data showed . In addition, a rapid decline in COVID-19 infections may have boosted spending, along with a shift in spending from services to goods.

But some economists cautioned against extrapolating too much from January's strong retail sales report, noting that sales rebounded after a sharp 2.5% drop in December. What's more, starting in 2018, retail sales have surged in January after falling in December.

Consumer prices rose 0.6% in January, but the increase in retail sales after adjusting for inflation was still quite large.

Retail sales are an important part of consumer spending and provide clues to the strength of the U.S. economy. According to foreign media reports, Americans are generally in good financial health. Savings are high, and wages and salaries are growing at the fastest rate in decades. However, high inflation rates have the potential to erode their purchasing power, making them unwilling to make as many purchases, or even endanger the economy.

The Federal Reserve is planning to raise interest rates to tame inflation, but central banks sometimes throttle economic growth when they do so.

Key details. Sales at auto dealerships jumped 5.7% in January, the government said Wednesday, posting a second straight month of sharp gains. Auto sales account for about a fifth of overall retail spending. Excluding cars, retail sales still rose a robust 3.3% last month.

Sales also rose sharply at Internet retailers ( 14.5%), furniture stores (7.2%), department stores (9.2%) and home centers (4.1%).

"Seasonal adjustments look off and may have changed with the pandemic ," said Scott Brown, chief economist at Raymond James. " Nevertheless, the underlying trend in retail sales appears to remain strong. "

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