World News

US Retail Sales Rise Slightly, as Consumer Confidence Wanes

U.S. retail sales rose modestly in August, but a new report says consumer confidence is waning.

Friday's report from the Commerce Department says prices paid by consumers grew just two-tenths of one percent in August, which is less than many economists had predicted. Then, a monthly gauge of consumer sentiment (by Thomson Reuters and the University of Michigan) fell this month to its lowest point since April.

The survey's director, Richard Curtin, said American consumers are worried about higher interest rates and the pace of job growth.

Investors closely watch U.S. household spending because consumer demand drives about 70 percent of U.S. economic activity.

Another government report said prices paid to producers of goods rose three-tenths of one percent, and showed no gain outside the volatile areas of food and energy.

This Producer Price Index may be evidence that future inflation will remain tame.

These reports are part of the data that top officials of the Federal Reserve will review next Tuesday and Wednesday as they consider possible changes in their efforts to stimulate the economy.

Fed efforts to keep interest rates low are intended to boost economic growth after the worst recession in decades.

A Gallup poll shows consumer confidence has improved since the worst of the crisis, but many Americans remain worried about losing their jobs.

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