March 12 (Bloomberg) -- Sales at U.S. retailers in February fell less than forecast and January’s gain was almost double the previous estimate, indicating the biggest part of the economy may be starting to stabilize.
Purchases decreased by 0.1 percent, led by the slump in demand for cars, following a revised 1.8 percent jump in January, the Commerce Department said today in Washington. Excluding automobiles, sales unexpectedly climbed 0.7 percent.
After tumbling at the fastest pace in three decades, consumer spending may stop hemorrhaging in coming months as a drop in fuel costs and tax cuts put more money in Americans’ pockets. Still, mounting unemployment and falling home and stock values make sustained gains in purchases unlikely until late 2009, economists said.
“The downdraft in consumer spending has lessened,” Ellen Zentner, a senior U.S. economist at Bank of Tokyo-Mitsubishi UFJ Ltd. in New York, said before the report. “The consumer will creep back into the market. There’s a lot of pent-up demand, and when that starts to come forward, it can help the economy find some traction.”
