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Retail Sales Rise More than Expected

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Retail sales rose 0.2% in November,

The US consumer spending indicator rose solidly in November, suggesting enough of a boost in the economy so that the Federal Reserve may raise interest rates for the first time in nearly a decade.

Retail sales in the US rose 0.2% in November, although the underlying consumer spending index climbed strongly due to the great start in the year’s holiday shopping season.

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According to the report released Friday by the US Department of Commerce, overall retail sales rose just 0.2% in November, as car purchases fell and lower gasoline prices decreased revenues in service stations.

Underlyings sales rise

However, underlying sales, which exclude cars, gasoline, building materials and food services rose 0.6% last month.

Consumer spending, which accounts for over two-thirds of economic activity, surprisingly slowed in September and October. The slowdown occurred despite a labor market adjustment, which has begun to raise household income.

The underlying sales result was above economists’ estimation, which had anticipated an increase of 0.4% in November.

In a separate report, the Labor Department said its producer price index rose 0.3% last month after falling 0.4% in October.

November marked the tenth consecutive 12-month decline in the index. The strong dollar and continued declines in oil prices amid oversupply and slowing global growth have dampened price pressures, inflation persistently falling below 2%.

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