U.S. retail sales increased in December as households bought motor vehicles and a range of other goods, pointing to strong demand in the economy and further reinforcing the Federal Reserve's cautious approach to cutting interest rates this year.

Retail sales gained 0.4% in December from November, slightly below projections for a 0.5% increase, according to FactSet.

U.S. retail sales increased solidly in December, pointing to strong demand in the economy and further reinforcing the Federal Reserve's cautious approach to cutting interest rates this year. Retail sales rose 0.

December’s retail sales report could be a bright spot for the economy, rounding out a surprisingly solid holiday season. By all accounts, the sales report—due Thursday morning at 8:30 a.m. Eastern—should be a solid one.

On a year-over-year basis, retail sales rose 3.9%. Total sales for the year increased 3.0% from 2023, with sales for the final quarter of the year rising 3.7% Y/Y. Core retail sales, which excludes motor vehicles and parts,