WASHINGTON — Retail sales slipped 0.1% in February as car sales tumbled following the end of another round of cut-rate financing offers, the government reported Thursday.
Although sales also had dipped in January, many private analysts dismissed the significance of the back-to-back declines on grounds that a variety of factors point to stronger economic growth and rising consumer demand in the months ahead.
Without a big drop in auto sales, retail sales would have posted a 0.3% increase last month, and analysts said that figure better reflected consumer sentiment.
The Commerce Department said sales totaled $117.3 billion last month, $90 million below the January level.
Sales had fallen 0.2% in January after posting a solid 1.9% increase in December. Sales had not declined for two consecutive months since last May and June.
Normally, weakness in retail sales is cause for concern since consumer spending accounts for two-thirds of total economic activity.
The February decline was led by a 1.3% fall in auto sales, the first setback in that category since a huge 17.3% drop in new car sales in October.
Sales at department stores rose 3% last month, following a 1.7% decline in December, and sales at furniture and home furnishing stores were up 2.9%, reflecting the current boom in housing sales.
The Commerce report said sales of durable goods--items expected to last three or more years--dropped 0.2% in February. In addition to the drop in auto sales, sales at hardware and building-supply stores fell 1.9%, offsetting the increase at furniture stores.
Sales of non-durable goods were unchanged in February despite the big gain in sales at department stores and a 0.8% rise in sales at clothing stores.
In a related story, the Federal Reserve Board reported that Americans took on $6.9 billion in new debt in January, reflecting a 15.2% annual rate of growth in consumer debt. The seasonally adjusted $6.9-billion debt bite followed a $5.6-billion, or 12.6%, rise in consumer debt in December and a 10.8% rise in November.
Preliminary figures had pegged the December debt increase at 10.8% or $5.1 billion.
The credit figures, which are adjusted for seasonal variations, showed that growth in automobile loans increased by $3.1 billion in January following a $1.3-billion gain in December.