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The US sees biggest retail sales drop since 2009

In a stark indication of a weak holiday season as well as a drop in spending, US retail sales for December posted its most significant slide in over nine years, triggering a sell-off and slide in the stock market.

Along with bleak sales data, other reports emerged indicating a higher number of jobless claims. The four-week moving average of claims is at a year high.

These factors have dimmed the US economic outlook. Both Barclays and JP Morgan cut the US fourth-quarter 2018 GDP forecast, following the reports.

Biggest US retail sales drop since 2009
Inside a Walmart. (CREDIT: Hanson Lu)

With the Federal Reserve holding on as much as they can before lifting interest rates, producer prices have fallen in January — making it the second consecutive month.

According to the US Department of Commerce, retail sales slipped 1.2%, the biggest since September of 2009.

The regular retail sales report for December was delayed due to the federal government shutdown. The market is yet to get a word on an expected timeline for the release of January data.

Adding to the woes was Thursday report by the US Department of Labor Department stating that initial claims for state unemployment benefits jumped by 4,000 to 239,000 for the week ended Feb. 9 (seasonally adjusted.)

 

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