Thursday, March 11, 1999 Published at 15:09 GMT
Business: The Economy
US retail sales boom
US shoppers continue to enjoy themselves - and spend.
The US consumer boom shows no signs of slowing down.
US retail sales in February were up 0.9% compared to January, the seventh monthly rise in a row.
US consumers spent a record $236bn last month on everything from new cars to furniture for their homes.
With unemployment at a record low, and the stock market at a record high, US shoppers are still spending more - and saving less - than ever before.
Sales of cars and clothing were particularly strong, rising by 1.8% and 1.0% for the month respectively.
"This underlines the strength of U.S. consumer spending. There is just no pausing for breath at all by the consumer," said Douglas Porter of Nesbitt Burns Securities.
Sales even higher
And even more surprising, retail sales for January were much stronger than previously announced. They have been revised upwards to show an increase of 1% for the month, as compared to the previous estimate of only 0.2% growth.
"These are off the map. The most important thing is the upward revision to the January figures. Now we're looking at 5% increase in real consumer spending again in the first quarter -- a remarkable six-month-long string of extremely robust consumer spending," commented Russell Sheldon, of MCM Moneywatch.
Threat to interest rates
Following a very strong Christmas for US retailers, these figures will confirm that the US economy is still growing at a torrid pace.
In the last quarter of 1998, the US economy grew at an annual rate of 6.1%.
Some analysts believe that the figures will lead the US central bank, the Federal Reserve, to raise interest rates when it meets at the end of the month.
But with inflationary pressures muted, the head of the Federal Reserve, Alan Greenspan, has recently indicated that he sees no reason to raise interest rates immediately.
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