The numbers: Sales at U.S. retailers jumped 0.6% in December to cap off a reasonably robust holiday shopping season, suggesting the economy still has the power to expand.
Economists polled by The Wall Street Journal had forecast a 0.4% increase.
Taken together, sales in November and December suggest a better-than-expected holiday-shopping season.
Retail sales represent about one-third of all consumer spending and usually offer clues on the strength of the economy.
Big picture: While still healthy, consumer spending is unlikely to boost gross domestic product — the official scorecard of the U.S. economy — as much in the fourth quarter as in the third quarter.
GDP is seen slowing to 1% to 2% in the final three months of the year from nearly 5% in the third quarter, the latest estimates show.
Consumers are spending more than enough money to keep the economy expanding and out of recession. But high interest rates and still-elevated inflation has exerted some drag on growth.
Market reaction: The Dow Jones Industrial Average
DJIA
and S&P 500
SPX
were set to open lower in Wednesday trades.
