U.S. retail sales fell by the most in a year and business equipment production slumped, raising concerns that the economy is losing momentum under the weight of tighter Federal Reserve policy.
The value of overall retail purchases broadly decreased 1.1% in December after a downwardly revised 1% drop in the prior month, Commerce Department data showed Wednesday. Separate figures showed a 1.3% decline in factory output last month that wrapped up the weakest quarter for manufacturing since the onset of the pandemic.
Taken together, the data show a consumer that’s losing steam and business investment falling, portending weaker growth and raising concerns that the economy may be inching closer to a recession. Combined with easing inflation, the figures put the Fed on track to further slow the pace of interest-rate hikes.
