US Retail Spending, Manufacturing Collectively Drop As Omicron, Inflation Surge

Retail sales dropped 1.9% in December, a big slowdown at the holiday season’s end; manufacturing output fell for first time since September

In a confirmation hearing for his second term as Federal Reserve chairman, Jerome Powell said the central bank would use its tools to tamp down inflation.

US retail spending and manufacturing slowed at the end of 2021 as the Covid-19 Omicron variant and inflation surged, early signs the latest complications from the pandemic could be weighing on the economy.

Sales at retail stores, online and restaurants dropped by 1.9%, damping the end of the holiday shopping season, the Commerce Department said on Friday. December’s sharp decline followed record-level retail sales that started with a 1.8% gain in October from the prior month.