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January 14, 2017

December vehicle sales push retail sales growth

A surge in vehicle sales led to a 0.6 percent increase in total retail sales in December. Auto dealers reported a 2.4 percent gain, NAFCU Research Assistant Yun Cohen noted in a NAFCU Macro Data Flash report.

"Sales at gasoline stations climbed 2 percent," Cohen said during December, "largely because of a seasonally atypical increase in gasoline prices."

However, she said, "sales excluding auto and gas were flat; the weakest reading since July."

Data published Friday by the Census Bureau also revised upward November's retail sales from 0.1 to 0.2 percent growth, and October's from 0.6 to 0.7 percent growth.

"Looking ahead, consumer spending is expected to grow moderately in light of a strong labor market, improving wage gains, and cheap gas prices," Cohen said. "President-elect Trump's fiscal stimulus and tax-cut proposals could also help to boost spending next year.

"However," she added, "a strong dollar as well as uncertainties about the new administration's economic and trade policies add downside risks."