U.S. January retail sales better than expected

Retail sales in the U.S. picked up steam in January, the Commerce Department reported Friday.

Theyincreased by 0.5 per cent, their best showing since November and higher than the 0.3 per cent increase many economists had expected.

Excluding autos, sales posted a 0.6 per cent increase, which was also better than expected.

Consumer spendingaccounts for 70 per cent of U.S. economic activity.Economists are worried that the spending gains since last summer could falter given the tough times facing many U.S. households.

Millan Mulraine, economics strategist at TD Securities, said in a commentary that "despite the moderate gain in retail sales, the tone of the report is very favourable, and it suggests that U.S. consumers have regained their appetite for spending (after the modest dip in December)."

But while the recovery appears to be taking hold, he said, "It will be some time before we can expect personal consumption expenditures to be the primary driver of the U.S. economic rebound."