Feb. 12 (Bloomberg) -- Sales at U.S. retailers excluding auto dealers probably increased in January for a ninth month as consumers took advantage of post-holiday sales to stock up on winter clothing, according to a survey of economists in advance of today's numbers from the Commerce Department. Spending at non-auto retailers rose 0.5 percent last month after a 0.1 percent increase in December, according to the median of 58 forecasts in a Bloomberg News survey. Cold weather and snowstorms in parts of the country probably damped sales of automobiles and caused total sales to be little changed last month after a 0.5 percent rise in December, the survey showed. The report is set for 8:30 a.m. in Washington.
Consumers bought more coats, sweaters and other cold-weather apparel as Americans redeemed holiday gift cards at chains such as Wal-Mart Stores Inc., Gap Inc. and Sears, Roebuck & Co. Rising consumer confidence, an improving job market and an expected surge in tax refunds suggest spending will pick up this quarter and help the economy accelerate. ``Consumers are continuing to do their part to keep the economic expansion vigorous,'' said Steven A. Wood, president of Insight Economics LLC in Danville, California. ``Substantial tax refunds will help boost spending'' through the first half of the year, he said. The Labor Department may report that the number of Americans filing initial unemployment claims dropped last week to 345,000, the third decline this year. Jobless claims may have fallen by 11,000, based on the median of estimates. In the last week of December and during the week that ended Jan. 23, claims reached 339,000, the lowest since January 2001. That report is also set for release at 8:30 a.m. in Washington. The Commerce Department, in a report to be issued at 10 a.m. Washington time, may say that business inventories increased 0.3 percent in December, the same as a month earlier, according to the median of economists forecasts.
Chain Store Sales
In the retail sales report, an increase in non-auto sales last month would extend gains to nine months, the longest since a two-year string of increases culminated in December 1999. Chain- store sales climbed 5.8 percent last month, the biggest January increase since 1999, according to a report last week from the International Council of Shopping Centers. Wal-Mart, the world's biggest retailer, reported a larger- than-expected increase of 5.7 percent in sales, compared with the same period last year. Gap, the largest U.S. clothing chain, said sales rose 3 percent, while Sears reported a 4.6 percent rise. Cold weather in the Northeast and Midwest fueled demand for gloves, hats and scarves.
``We've had very strong results,'' said Philip Roizin, chief financial officer at Brookstone Inc., a retailer of specialty electronic devices, in an interview Friday. The rise in sales makes it ``more likely'' Brookstone will hire and invest in new equipment in carrying out plans to open 15 to 20 new stores this year, Roizin said. The Nashua, New Hampshire, retailer last week reported a 12.6 percent increase in sales for the fourth quarter. Low temperatures and snowstorms may have persuaded consumers to seek the warmth of malls rather than visit dealer showrooms, the retail sales report is forecast to show.
Auto Sales Slowed
Carmakers sold light vehicles at a 16.1 million annual rate in January, down from 18 million the previous month, industry figures earlier this month showed. ``Given the very generous level of cash incentives, together with super-cheap financing, and low prices, we think that the return of more seasonable weather will bring out buyers next month, and we expect February auto sales figures to snap back sharply,'' said Joseph Abate, a senior economist at Lehman Brothers Inc. in New York, in a research report to clients. For their part, chain-store retailers are seeing sales accelerate this month. Purchases rose 1.8 percent for the week ended Feb. 7 compared with the prior week, according to a report issued today by the shopping center council and UBS, which track sales at 75 chains. Receipts are up 0.9 percent compared to the same time last month. Sales are rising amid improving confidence and more jobs. The economy added 112,000 jobs last month, and the unemployment rate fell to a two-year low of 5.6 percent, the Labor Department reported Friday.
Confidence
The improvement is being reflected in rising consumer confidence. The University of Michigan's sentiment gauge reached a three-year high last month while the Conference Board's measure rose to the highest in more than a year. More optimistic consumers will be getting larger tax refunds this year. Because the tax cuts that took effect in July 2003 were retroactive to January, government refunds may be boosted by about $30 billion this year, according to Lehman's Abate. Household purchases, which account for 70 percent of the economy, may grow at a 3.6 percent annual pace from January through March, a percentage point more than in the previous three months, according to the median estimate in separate Bloomberg News survey of economists this month. As a result, the economy will probably expand at a 4.5 percent pace this quarter following growth of 4 percent in the final three months of 2003, the survey showed. The survey also showed the world's largest economy is projected to expand 4.6 percent for the year, the most since 1984. //www.bloomberg.com