US retail sales likely to surprise upside in December

US motor vehicle manufacturers reported that unit sales dropped by 4.72% to a six-month low seasonally adjusted annual rate of 17.2 million in December.

Nominal consumer goods spending - is also expected to have accelerated quickly during the reference period.

Markets anticipate accelerations in clothing, general merchandise and online sales, along with a rebound in furniture outlays, to power the forecasted gain in control purchases last month.

Reduced motor vehicle, gasoline purchases and restaurant meals probably left retail and food services sales 0.3% higher in December, marginally hiding the 0.2% uptick posted in November. 

Consumer spending, which accounts for more than two-thirds of U.S. economic activity, slowed in September and October. The weakness came despite a tightening labor market, which has started to lift household income.

According to the forecast retail spending metric over the October-December span 4.4% annualized above its July-September average, almost matching the reported 4.7% summer-quarter gain.