Superstorm Sandy a factor in retail sales drop last month
WASHINGTON -- Retail sales dropped in October for the first time in three months as Superstorm Sandy took its toll on auto sales, the Commerce Department said Wednesday.
Retail and food-service sales were down 0.3% last month, compared with September. Analysts had expected Sandy, which paralyzed much of the Mid-Atlantic and Northeast, to cause a drop in spending by consumers.
But October’s decline was more than the 0.2% expected, suggesting that consumer spending slowed for other reasons than the storm.
“The weakness in the sales report was not enough to confirm that it was not simply a weather-related dip, but the components suggest that there was more going on than just Sandy,” said Steven Ricchiuto, chief economist at Mizuho Securities.
He noted that sales of building materials dropped 1.9% in October from the previous month, and that there were downward revisions to auto sales from the previous two months.
Car buying has been a major driver of retail sales growth recently. Auto sales dropped 1.6% last month compared with September. But higher gas prices led to an increase of 1.7% in sales at gas stations in October compared with the previous month.
The Commerce Department said it couldn’t pinpoint Sandy’s effect on October retail sales.
Some companies reported sales drops because of damage to stores and reduced business caused by the storm, the agency said. But other firms said they saw increases from purchases by storm victims.
The monthly retail sales report is not designed to break out regional figures, the Commerce Department said.
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