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U.S. retail sales suffer biggest drop in nearly two years
POSTED: 11:26 a.m. EDT, July 14,2007

U.S. retail sales fell by 0.9 percent in June, the sharpest plunge since August 2005, the Commerce Department reported Friday.

The drop in retail sales for June followed an increase of 1.5 percent in May.

In June, sales of autos and auto parts dropped by 2.9 percent, after a 1.1-percent gain in the previous month.

Sales at furniture stores were down 3.0 percent, the biggest plunge since February 2003, following a small rise of 0.3 percent in May.

Meanwhile, sales at hardware stores fell by 2.3 percent, while sales at specialty clothing stores declined by 1.4 percent. Department stores saw sales fall by 1 percent.

Gasoline stations saw sales drop by 1.1 percent, a decline attributed to a temporary fall in gasoline prices in June.

Excluding auto and parts sales, total retail sales would have fallen by 0.4 percent, the weakest performance in this category since last September.

The performance in retail sales reflects the situation of consumer spending, which accounts for two-thirds of overall economic activity and is a major force pushing economic growth.

The June drop in retail sales was much sharper than the flat reading expected by economists and raised new worries about consumer spending, according to analysts.

From: xinhua
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