A trip to the mall doesn't boost optimism, according to economists, who were reluctant to call today's surprisingly positive retail sales report good news for the U.S. economy.
"One data point does not a trend make," said Guy LeBas, strategist at Janney Montgomery Scott. Nevertheless, he called the report "heartening."
His reaction was mirrored by many economists, who were quick to admit positive sales across a range of retail sectors is good news - but not a clear recovery sign.
Overall retail sales rose 1.0% in January - the first increase in seven months - against expectations for a 0.8% drop. Ex-autos, sales grew 0.9% against forecasts for a 0.4% fall.
While economists were expecting the jump in gas sales, the climb in sales of cars, electronics, clothes and restaurants was unanticipated.
Paul Dales, economist at Capital Economics, said the jump in discretionary spending suggests the "consumer may be willing to buy at the right price."
Like Dales, many economists attributed the surprise jump to steep post-holiday discounting.
Still, he said the jump could be temporary, and runs against Redbook's retail sales figures, and earnings reports from major retailers.
Charmaine Buskas, economist at TD Securities, called the surprise merely a "reprieve" from several months of dismal numbers.
"The consumer is still backed into a corner and the January numbers do not materially change this," she said, adding that she expects consumer spending to be a drag, not a boost to growth in the coming months.
So when will the turnaround come? Not for some time, according to Stephen Gallo, analyst at Schneider Foreign Exchange.
Of the 72 economists polled by Bloomberg, Gallo had most accurately forecast the jump in U.S. retail sales for January, with an expectation of a 0.7% increase, against a slew of negative estimations.
Nevertheless, he said key components in the report showed the underlying weak spot in the U.S. economy remains: the housing sector.
He said the drops in building materials and furniture sales in Thursday's report "tell me the root of the problem is still there."
As for this month's healthy results, "statistically it's probably more of an aberration," he said.
By Megan Ainscow and edited by Sarah Sussman
©CEP News Ltd. 2009