Retailers enjoyed a healthy boost in July sales, a sign that shoppers are feeling more confident about spending.
Retail sales rose 0.6% last month, the Commerce Department said Thursday. When stripped of the volatile vehicle and parts segment, retail sales swung up a more modest 0.4%.
In another positive sign, retail sales for June, previously reported as falling 0.3%, were revised upward to be virtually unchanged.
Analysts said July may indicate that American consumers were finally opening their wallets as gas savings and strong job gains boosted confidence.
But shoppers have largely defied economists' predictions this year, choosing to sock away money or pay down debts with their extra savings. Consumer spending makes up more than two-thirds of economic output, making retail sales a strong gauge of the country's economic health.
July's retail results echoed other recent signs of economic growth.
The Labor Department said last week that the economy added 215,000 net new jobs last month, driven by retailers and healthcare providers. Average hourly earnings also jumped by 5 cents to $24.99 after falling by a penny in June.
Economists said solid retail sales will fuel expectations that the Federal Reserve will raise interest rates in September for the first time since 2006.
In July, 11 of 13 categories showed growth.
Building materials and garden supplies increased 0.7%. Furniture stores rose 0.8%. Clothing and accessories edged up 0.4%.