WASHINGTON (AFP) - US retail sales posted a surprise 0.7 percent rebound in August despite another sharp drop in car sales, the government reported Thursday.
The increase, taking sales to $618.7 billion, defied expectations for another drop, after the indicator measuring consumer demand fell 1.8 percent in July.
Car sales fell 3.9 percent, but if vehicles are excluded, overall retail sales jumped 1.8 percent, according to the Commerce Department.
Auto prices surged as the US economy began to reopen from the pandemic closures and Americans resumed traveling, causing strong demand from rental car companies that was exacerbated by a semiconductor shortage which slowed auto production lines.
But with rental companies having restored their fleets, car sales have slowed.
Sales at appliance and electronics stores fell 3.1 percent, while restaurants and bars managed flat sales, the report said, despite concerns over rising cases of the Delta variant of Covid-19.
Furniture stores saw a 3.7 percent jump, and grocery stores posted a 1.8 percent increase.
Meanwhile, online sellers bounced back with a 5.3 percent gain, more than making up for the 4.6 percent drop in July, the report said.