Retail Sales Up a Sluggish 0.3% in September

Retail sales rose in September but at a much slower rate than expected, a government report showed Wednesday, signaling a slowdown in consumer spending that could mean weaker economic growth.

Despite a solid increase in new-car sales, retail sales rose just 0.3% to $224.9 billion, the Commerce Department said, well below economists’ 0.6% forecast. The department also revised August sales to unchanged from a previously reported 0.2% rise and July sales to down 0.7% instead of down 0.6%.

Consumers pushed auto sales up 0.9% in September, the best gain in four months, following a slight decrease of 0.1% in August and a plunge of 4.3% in July, during the General Motors strikes. But spending on clothes fell 1.3% and furniture sales edged down 0.2%. Excluding cars, sales crept up just 0.1%, the same as in August.

Economists said the report suggests that consumers have turned somewhat cautious after world financial turmoil spilled over into the U.S. stock market in late August.

“Not long ago, it looked as if American consumer spending was just going to steam ahead regardless of anything happening elsewhere in the world. Now . . . the consumer mood has indeed been dented,” said economist William Cheney of John Hancock in Boston.

A separate report Wednesday showed that prices businesses paid for imported goods fell in September for the 11th consecutive month. Export prices also fell, for the fourth month in a row. The Labor Department said the import price index fell 0.1%. Prices of U.S. products exported to other countries fell 0.5%.

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Retail Sales

In billions of dollars, seasonally adjusted:

September: $224.9 billion

Source: Commerce Department