U.S. retail sales increased more than expected in May as consumers bought motor vehicles and a range of other goods even as they paid more for gasoline, the latest indication of an acceleration in economic growth in the second quarter.
The Commerce Department said on Thursday retail sales jumped 0.8 percent last month, the biggest advance since November 2017. Data for April was revised up to show sales rising 0.4 percent instead of the previously reported 0.2 percent gain.
Economists polled by Reuters had forecast retail sales rising 0.4 percent in May. Retail sales in May increased 5.9 percent from a year ago.
Excluding automobiles, gasoline, building materials and food services, retail sales increased 0.5 percent last month after an upwardly revised 0.6 percent increase in April. These so-called core retail sales correspond most closely with the consumer spending component of gross domestic product. They were previously reported to have risen 0.5 percent in April.
The Federal Reserve raised interest rates on Wednesday for the second time this year. The U.S. central bank forecast two more rate hikes for 2018. The Fed said “economic activity has been rising at a solid rate” and “growth of household spending has picked up.”