Newspaper article THE JOURNAL RECORD

Retail Sales Fall 0.6 Percent in August

Newspaper article THE JOURNAL RECORD

Retail Sales Fall 0.6 Percent in August

Article excerpt

WASHINGTON (AP) - Retail sales dropped 0.6 percent in August, the government said Friday. Analysts said the government's first report on Americans' spending since the Persian Gulf crisis indicated growing consumer caution - but not panic.

Economists agreed the report was worrisome evidence of continuing economic weakness, but appeared to be worse than it really was because of the impact of the oil shock on the service station sales and the way automobile sales are counted.

``If you take out gas and autos, it was down 0.1 percent,'' said David Berson, chief economist for the Federal National Mortgage Association.

The Commerce Department said overall sales totaled a seasonally adjusted $149.2 billion, down from $150.0 billion in July and the largest decline since sales fell 1.0 percent in April.

Auto sales fell 4.3 percent, their steepest drop since sinking 5.6 percent in January. But economists said that reflected a seasonal adjustment and that actual sales were virtually unchanged from both June and July.

Excluding automobile sales, retail sales rose 0.4 percent in August.

On the other hand, sales at gasoline stations jumped 6.4 percent, the largest increase since a 8.3 percent gain in August 1979.

But analysts said the sharp hike reflected sharply higher prices rather than increased volume. The American Petroleum Institute said gasoline prices have risen 20 percent since the Iraqi invasion of Kuwait on Aug. 2.

Nevertheless, sales would have fallen 1.1 percent without the service station category.

``The simple reality is that consumers are gradually pulling back in their spending out of concern over a weakening job market and unstable conditions in the Middle East,'' said David Jones, an economist with Aubrey G. …

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