US retail sales hold up despite falling consumer sentiment

Consumer sentiment is still falling in the US. MarketWatch reports:

Consumer sentiment fell in October, continuing its slide since a peak in July, according to a monthly survey released Friday by Reuters and the University of Michigan.

The October consumer sentiment index was 82.0 -- the lowest since August 2006 -- below 83.4 in September. The consensus forecast of Wall Street economists had expected sentiment to hit 84.5.

But retail sales have held up relatively well, at least in September.

U.S. retail sales increased more than expected in September, rising 0.6% on strong sales of gasoline, automobiles and food, the Commerce Department reported Friday...

Much of the gain in retail sales can also be traced back to higher energy prices, with gasoline sales rising 2%. A surprising 1.2% gain in motor vehicle sales provided most of the remainder of the lift in sales. Excluding gas and cars, sales rose just 0.2%, the government said. Read the full government report.

Further good news is that there is little wholesale price inflation if you ignore food and energy.

U.S. producer prices rose a larger-than-expected 1.1% in September, but core inflation increased a tame 0.1%, the Labor Department reported Friday...

Energy prices alone rose 4.1% last month, the most since November...

Food prices rose 1.5%, the most since March.

Over in Japan, a little more inflation would be seen as a good thing. Instead, it got a little less at the wholesale level in September. Bloomberg reports:

Japan's wholesale inflation slowed for a third month in September as financial-market turmoil triggered by a U.S. housing slump damped commodity prices and strengthened the yen, making imported materials cheaper.

The producer price index climbed 1.7 percent from a year earlier, extending 3 1/2 years of gains and following a revised 2 percent advance in August, the Bank of Japan said in Tokyo today. The median forecast of 34 economists surveyed by Bloomberg News was for a 1.9 percent increase...

From a month earlier, Japan's producer prices fell 0.1 percent, the central bank said.

At least consumer confidence in Japan did not fall in September.

Japanese household sentiment barely rose from a three-year low in September, a signal that consumer spending is unlikely to accelerate.

An index that measures confidence among households with two or more people edged up to 44.1 points last month from 44 in August, halting a four-month slide, the Cabinet Office said in Tokyo today.