Image Source:Flickr

Image Source: Flickr

According to official figures the US retail sales fell in May for the first time in almost a year, mainly because of sharp drop in car sale . Sales fell 0.2% from the month before to $387.1billion.

Car sales fell 2.9%, in part due to delivering issues caused by March’s earthquake in Japan.

Despite the fall, analysts predict sales were better than expected and highlighted the increased spending against a year earlier.

According to economists despite the largest decline in the auto industry car sales are still up 5.4% from may 2010. On the whole, sales are 7.7% higher than total transactions conducted 12 months ago.

Taking car sales out of the equation, retail sales were on a rise by 0.3% on the previous month. But its considered weak recovery. The sales statistics were welcomed by the markets, with the main Dow Jones index closing up 123.1 points, or 1.0%, at 12,076.1.

Shareholders viewed the data as a welcome relief from some reduced recent economic statistics. Last week, the Federal Reserve said development had appeared to slow in several districts across the US in May.

Official data showed that US employment growth slowed sharply in May, with only 54,000 net new jobs added during the month. Markets had expected a rise of 150,000 , which is showing weak recovery according to analysts.