U.S. retail sales sink 1.9% in December in biggest decline in 10 months

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Numbers: Sales at US retailers such as Target and Walmart fell 1.9% in the last month of 2021, as Omicron spread like wildfire and shoppers faced higher prices due to rising inflation.

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Economists polled by The Wall Street Journal had forecast a 0.1% decline in December.

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If high inflation is taken into account, retail sales were hit even more in December.

Retail sales excluding auto dealers declined sharply by 2.3% last month, government said on Friday, Car sales fell last year following a reduction in production due to a lack of computer chips.

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Retail sales constitute a large part of consumer spending and indicate the strength of the US economy. Sales rose sharply for much of last year before easing in the waning months.

big picture: The economy faced a recession by the end of 2021 due to Omicron. The highly contagious coronavirus strain has infected millions and caused many people to lose their jobs.

Persistent shortages of supply and the highest inflation in nearly 40 years have also hurt. Customers don’t always get what they want and the prices of many goods and services have risen sharply.

However, households still have plenty of savings, and economists predict spending will improve if the pandemic finally begins to end and inflation is brought under control.

Market Feedback: Dow Jones Industrial Average DJIA,
-0.49%
and S&P 500 SPX,
-1.42%
There was a decline in Friday’s trading. The stock has been up and down for the past one week.

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