A gauge of US consumer spending rose solidly in November as the Christmas shopping season got off to a fairly brisk start.
The figures suggested there is enough momentum in the economy for the Federal Reserve to raise interest rates next week for the first time in nearly a decade.
The US Commerce Department said today that retail sales - excluding cars, petrol, building materials and food services - increased 0.6% after an unrevised 0.2% gain in October.
These so-called core retail sales correspond most closely with the consumer spending component of US gross domestic product.
Economists polled by Reuters had forecast core retail sales increasing by 0.4%.
Consumer spending, which accounts for more than two-thirds of US economic activity, surprisingly slowed in September and October.
The moderation came despite a tightening labour market, which has started to lift household income.
The latest signs of strength in consumption support expectations that the Fed will raise its benchmark overnight interest rate from near zero when policymakers conclude a two-day meeting next Wednesday. The Fed has not raised rates since June 2006.
Overall retail sales increased only 0.2% in November as car sales fell and cheaper petrol weighed on receipts at service stations. Retail sales had edged up 0.1% in October.
Car sales slipped 0.4% in November, the largest decline since June, after falling 0.3% in October.
Though car makers reported strong sales last month, the units sold were slightly below October sales. Receipts at service stations fell 0.8% after declining 1% in October.
Elsewhere, sales at clothing stores shot up 0.8%, the largest increase since May.
Sales at online retailers rose 0.6% and receipts at sporting goods and hobby stores increased 0.8%. Sales at electronics and appliance outlets advanced 0.6%.
The increase last month in discretionary spending suggested a fairly busy start to the Christmas shopping season.
However, receipts at building materials and garden equipment stores slipped 0.3% as did sales at furniture stores.
