US consumers boosted retail sales by 2.3% in January, the government said today in a big surprise to analysts expecting an increase of just 0.9%. Overall, retail sales were the strongest since May 2004.
Excluding the 2.9% gain in the sometimes volatile category of car sales, seasonally adjusted retail sales rose 2.2% for the month, ahead of the 0.8% expected by private economists.
Petrol station sales increased 5.5% in January amid a jump in prices. Excluding petrol and cars, retail sales rose 1.8 % in January, the strongest since March 2004.
The retail sales report comes one day before two highly anticipated appearances before Congress by new Federal Reserve Chairman Ben Bernanke.
Fed policymakers will digest January's sales numbers but must also consider February's before their March 27-28 meeting. The strength of consumer spending is critical to the Fed and the US economy over the long term. Bernanke testifies before Congress tomorrow and on Thursday.