Washington, DC, Feb. 12--Retail sales fell unexpectedly in January as auto demand suffered the sharpest drop in 11 months.
Retail sales decreased by 0.3% to $322.87 billion, the Commerce Department reported Thursday. It was the first decline since September. Sales rose a revised 0.2% in December, and jumped 1.1% in November.
Economists had expected a 0.1% gain in January, according to a survey by Dow Jones and CNBC.
Sales were driven lower by a 3.9% decrease in demand at motor vehicles and parts dealers--the biggest decline in the sector since February 2003. Excluding auto-related buying, overall retail sales would have gone up by 0.9%, the biggest gain in five months.
The retail sales report showed that consumers opened their wallets in January to buy clothing, food, sporting goods, books, music, electronics and appliances. But those gains were more than offset by a reduction in spending on cars, as well as building and garden supplies.
In annual terms, sales were up 5% from January 2003.
