- Gennadiy Goldberg, a US strategist at TD Securities
US retailers saw strong sales in October, a sign American consumers willingly opened their wallets, helping the nation's economy to expand robustly. US core retail sales, which exclude volatile components such as autos, rose 0.3% in October, beating economists expectations for a 0.2% gain. Household spending accounts for more than two-thirds of US economic output. However, uneven and sluggish growth in consumer outlays since the recession's end more than five years ago has limited overall economic growth. Consumer spending contributed 1.22 percentage points to the 3.5% third-quarter GDP growth rate, compared with spending's 1.75-percentage-point contribution to the second quarter's pace of 4.6% growth. Meanwhile, a separate report showed that US import prices dropped in September by most in more than two years as the cost of energy products fell and a strong Dollar made it cheaper for Americans to purchase goods from abroad. The Labor Department said on import prices fell 1.3% last month.
A separate report showed that consumer confidence hit the highest level since July 2007. The preliminary estimate of consumer confidence from the University of Michigan came in at 89.4, overshooting expectations for an 87.5 reading and up from the final gauge of 86.9 in October.
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