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A worrying sign for the US economy
Disappointing job figures, less than spectacular growth and now there's a new concern for the US economy. Research by Morningstar suggests retail sales are not only below what we would normally expect, they're in decline. The official figures, which come out mid-month, are an important number for the economy as consumption accounts for 70% of GDP.
Bob Johnson, the Director of Economic Analysis for Morningstar, says retail sales normally grow between two and four percent on a year on year average basis. But we're running below that now at one point five percent and the situation's getting worse. His analysis comes on the back of disappointing results from some of America's biggest retail brands in recent weeks.
Bob points out that the terribly cold weather in much of the USA could be to blame. However, if we don'ts see a strong bounce in the coming few months, it could be a warning sign.
01:24 minutes
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