WASHINGTON — Consumers cut back on their shopping in August by the largest amount in six months as a big drop in auto sales offset gains in other areas.
Retail sales dropped 0.2% last month after a 0.3% gain in July, the Commerce Department said Friday. It was the biggest one-month decline since a 0.2% decline in February. Auto sales sank 1.6% in August, the most in seven months.
Excluding autos and gas, which tend to be volatile from month to month, sales dipped 0.1% in August after having risen 0.5% in July.
Still, thanks to a still-solid job market, economists generally remain upbeat about retail sales in coming months, with many saying they expect consumer spending to grow at a solid 2.5% rate in the July-September quarter.
Sales rose last month at general merchandise stores, a category that includes big-box retailers such as Target. Rising gasoline prices also boosted sales.
The overall economy, as measured by the gross domestic product, grew at a robust 3% annual rate in the April-June quarter, more than double the lackluster 1.2% rate in the first quarter. Analysts generally predict that growth in the current July-September quarter will remain in a solid range of 2.5% to 3%, with a key boost coming from consumer spending.
The consumer sector, which contributes to 70% of economic activity, is benefiting from the lowest unemployment rates in 16 years and continued strong job gains.
For August, gasoline sales were up 2.5%, the biggest jump since last December. But that increase reflected in large part rising prices.
Sales at general merchandise stores, which includes big-box retailers such as Walmart and Target, were up 0.2% although sales at department stores including Macy’s, edged down 0.1%. Sales at non-store retailers, a category that covers booming online sales, dropped 1.1% in August after a 1.8% gain in July.