US retail sales decline in January

Retail sales in the United States were down in February for the first time in six months, according to new data released on Tuesday. The decline was blamed on slow automobile sales and the turn from mild winter weather to colder temperatures. A decline had been expected, but it had not been forecast to be as steep as it turned out to be.

The decline amounted to 1.3 percent overall, after an increase of 2.9 percent in January. However, when the automobile sector is excluded the fall-back in sales was only 0.4 percent. Analysts said that the decline should not cause concern, considering that the average rate of increase over the past few months was good. Predictions are that the first quarter of 2006 will see consumption go up in the neighborhood of 5 percent.

On the other hand, analysts do worry about deficits and their eventual effect on the value of the dollar. Their concerns were not eased any by current account deficit information also released on Tuesday. The current account deficit grew to $225 billion in the fourth quarter of 2005, a new record. The new figure came on the heels of a reading of a $185 billion deficit in the third quarter and brought the total current account deficit for 2005 to $805 billion.

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