- Reuters -
Sales at U.S. retailers unexpectedly fell in May for the first time in eight months, but a jump in consumer sentiment to a near 2-1/2 year high in early June tempered fears of a slowing economic recovery.
The drop in sales reported by the Commerce Department on Friday reflected weak gasoline prices and the end of a home buyer tax credit that had boosted sales of building materials.
Analysts said the underlying trend of steadily advancing consumer spending was intact -- despite some recent data that suggested a slowing of the recovery -- and there was little risk of the economy slipping back into recession.
"We have placed a double-dip in the U.S. for a long time at 15 percent and that is still where we are. The most likely scenario is the economy continues to grow at a 3-percent pace," said Michael Strauss, chief economist at Commonfund in Wilton, Connecticut.