US retail sales better than predicted

Retail sales in the US increased twice as much as in May than forecasted. Purchases climbed 1%, the most in six months, following a 0.4% April gain that was previously reported as a drop, according to the US Commerce Department in Washington, DC. There was an increased demand in every merchant category except for miscellaneous retailers.

The figures suggest that consumers, whose spending accounts for more than two-thirds of the economy, are fending off a deeper recession. Stuart Hoffman, chief economist at PNC Financial Services Group Inc. said, "It's just amazing -- the American consumer's resilience in the face of everything negative."

Following the retail report, JPMorgan Chase & Co. forecast the Federal Reserve would raise the benchmark rate by a quarter point to 2.25% at its September meeting. JPMorgan Chase economists had previously projected the rate wouldn't increase until the second quarter of 2009.

Stocks rose and the dollar gained 0.8% - US$1.5434 per euro.