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WASHINGTON -- Consumers cut spending back sharply in October, pushing retail sales down by a record amount—2.8 percent—surpassing the previous record drop of 2.65 percent, which occurred in November 2001 after the terrorist attacks of Sept. 11, The Associated Press reported, citing the latest Commerce Department data.
The sales decline was led by a drop in auto purchases, but sales across the board fell as consumers worried about their jobs and the market turbulence, and kept their wallets close, the AP reported. Excluding autos, sales fell 2.2 percent, while gasoline stations saw a record 12.7 percent decline, as both demand and prices for gas have fallen, Reuters reported. Excluding autos and gasoline, retail sales fell 0.5 percent, according to the report.
The retail sales slump marked the fourth straight decrease, the longest stretch of weakness on record, and was worse than the 2 percent decline analysts expected, according to the AP report.
Retailers, meanwhile, are bracing for what some have called the worst holiday shopping season in decades, with economists forecasting a recession that could be the steepest since the 1981-82 downturn, the report stated.