WASHINGTON (AP) -- Americans likely spent more on retail goods last month, particularly cars and gas, an encouraging rebound after a disappointing showing in December.
Economists forecast that retail sales rose 0.7 percent in January, according to a survey by FactSet. That would be an increase from a meager 0.1 percent gain in December. The Commerce Department releases the report at 8:30 a.m. Eastern time Tuesday.
A healthy showing would suggest that December's slowdown was temporary and that recent increases in hiring has encouraged more spending. It's important, since consumer spending accounts for roughly 70 percent of economic activity.
The government's retail sales report is its first look each month at consumer spending.
Retail sales have risen about 20 percent since hitting a recession low. And they're nearly 6 percent above their pre-recession high.
Earlier this month, big chain retailers reported a solid increase in January sales. The gains weren't evenly spread. Lower-prices stores such as Target and Costco reported big gains. Macy's and other stores that sell mid-price goods didn't do as well.
The government's monthly report is a broader gauge of retail sales. It covers purchases at all retailers, including auto dealerships, restaurants and bars, grocery stores and gasoline stations.
Automakers reported strong sales in January, on top of healthy gains that took place in November and December. Low interest rates, better loan availability and new car models helped drive sales higher.
More expensive gas likely pushed retail sales higher, too. Gas prices have risen sharply since December. The average price for a gallon of gas was $3.51 on Monday, up 12 cents from a month earlier.
Still, excluding gasoline, most economists expect sales to have risen at a healthy clip.
Americans are taking on more debt after cutting back in the aftermath of the recession. Consumer borrowing, which includes credit cards, auto loans, and student loans, posted the biggest monthly gains in a decade in November and December.
The increases could be a sign that consumers are more confident about the economy. But they could also mean that some are increasingly reliant on credit as wages have failed to keep up with inflation in the past year.
Hiring has picked up in recent months, which could support more spending. Employers added 243,000 net jobs last month, the fifth straight month of solid hiring.
The economy, meanwhile, expanded at an annual rate of 2.8 percent in the final three months of last year. Growth may slow a bit from that pace in the current quarter. Many economists forecast modest growth of 2 percent to 2.5 percent this year.
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