US retail sales fell for the first time in seven months in October as purchases dropped, pointing to slowing demand at the start of the fourth quarter that further strengthened expectations the Federal Reserve is done hiking interest rates.
Additional statistics demonstrating the largest drop in producer prices in three and a half years in October corroborated that. The claims came after it was reported that, for the first time in over a year, consumer prices were steady last month.
Based on the data and a contracting labour market, economists concluded that the cycle of rate hikes by the US central bank was coming to an end. However, there is no indication that a recession is about to hit the economy. October’s sales decline was not as severe as anticipated, coming after three solid months of increases, with clothing store sales remaining unchanged.
Target forecast a holiday-quarter profit largely above Wall Street expectations, but noted that consumers were delaying spending until the last minute.
