Retail sales in the U.S. rose more than expected at the start of the year, in a sign that consumers' willingness to spend may be increasing, in part due to a strong labor market and inflation that is beginning to moderate.
According to new figures from the Commerce Department on Wednesday, seasonally adjusted retail sales in the world's largest economy rose 3.0% in January on a monthly basis, rebounding from a 1.1% decline in December.
Economists have estimated that the figure will increase by 1.8%.
The reading came after data on Tuesday showed that inflation moderated to 6.4% year-on-year in January, following a series of aggressive interest rate hikes by the Federal Reserve. However, inflation increased from month to month.
Meanwhile, NFP data rose by 517,000 through mid-month, abruptly breaking a four-month trend of slowing job gains. Analysts had expected a further decline to 185,000, which would be the slowest job growth in nearly two years.
December's payroll data was also revised up by 37,000 and November by 34,000, reinforcing the surprise in January's figures. As such, the figures provide further evidence of an overheated labor market as the pandemic subsides.
The US dollar index which measures the US dollar against six major currencies remained firm with a 0.60% strengthening to trade at 103.745 after retail sales data was released.
