Retail sales rise unexpectedly in January - 13 WTHR Indianapolis

Retail sales rise unexpectedly in January

Updated:
U.S. retail sales jumped 1 percent in January. U.S. retail sales jumped 1 percent in January.
Valentine's Day sales are expected to be down. Valentine's Day sales are expected to be down.

Rich Van Wyk/Eyewitness News

Indianapolis - U.S. retail sales jumped 1 percent in January, reversing a six-month declining trend and defying economists' expectations by posting the biggest increase in 14 months.

But higher gasoline prices and sales, and buyers snapping up other items on post-holiday discounts appeared to aid last month's results. Analysts cautioned that the relief is unlikely to last.

"This is okay news. It's not bad news," said Chuck Williams, Dean of Butler University's College of Business Administration. Considering the way the economy has been going over the last six months, Williams added, "Actually yes, we'll take good news."

For an industry coming off the worst Christmas buying season in almost 40 years, the increase in sales hasn't come easily. Retailers have worked aggressively to convince consumers to reopen their wallets, using sales, deep discounts and other incentives to clear inventories.

"That no doubt has had people ready to reach in the wallets and say this is too good a deal, I've got to snap this up," said Williams.

The question now is whether the increase is a fluke or consumers will keep spending - causing retailers to increase orders and sustain the rebound.

The National Retail Federation expects Valentine's Day spending to fall by more than 15 percent.

"It's been brisk, people are a little more thoughtful of their purchases," said David Stromeyer, manager at McNamara, the city's largest florist.

McNamara has reduced its inventory, and despite higher costs, kept prices the same. Although smaller bouquets are popular, roses are still hot, and the ways of the heart unpredictable.

"These next few days we will have guys lined up to the front door if we are lucky," said Stromeyer.

With nearly $15 billion expected to be spent among Valentines, don't underestimate the economic power of love.

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