US Retail sales rose higher than expected in June as consumers shopped for motor vehicles and other goods, even as they paid more for gasoline.
Retail sales rose 1.0% last month, the Commerce Department said on Friday. Figures for May were revised to show that sales were down 0.1%, rather than the 0.3% decline previously reported.
Economists polled by Reuters were forecasting a 0.8% increase in retail sales, with forecasts for a 2.2% increase from a 0.2% decline. Retail sales consist primarily of merchandise and are not adjusted for inflation.
US consumer prices rose 9.1% year-on-year in June, the biggest increase since November 1981, putting the Federal Reserve on track to hike the interest rate further to 0.75 percent later this month. , Since March, the US central bank has raised interest rates by 1.50 points.
Gasoline prices rose by an average of $5 a gallon in June, according to data from the American Automobile Association (AAA). But they have since fallen from last month’s record highs and averaged $4.577 a gallon on Friday.
Retail sales were also boosted by motor vehicle purchases following the pressure of shortages.
Excluding automobiles, gasoline, building materials and food services, retail sales grew 0.8% in June. May’s figures were revised to show that those sales were down 0.3%, not unchanged as previously reported.
Core retail sales are closer to the consumption component of GDP.