10:36 AM EDT, 09/17/2024 (MT Newswires) -- US retail sales in August rose against Wall Street's expectations for a decline, while the pace of growth slowed amid declines in gas station and motor vehicle component sales, Census Bureau data showed Tuesday.

Sales edged 0.1% higher in August, decelerating from an upwardly revised 1.1% rise in the month before. Analysts were modeling for a 0.2% decline, according to a consensus survey compiled by Bloomberg. Annually, retail sales were up 2.1% in August, the government data showed.

"Some slowing in retail spending was expected, particularly after July's outsized gain," TD Economics Senior Economist Thomas Feltmate said. "That said, last month's uptick still came in stronger than expected, while revisions to prior months were relatively negligible."

Spending on motor vehicles and parts fell 0.1% sequentially in August. Excluding auto, retail sales rose by 0.1%, below analysts' average expectation for a 0.2% gain.

Spending at gas stations dropped 1.2%, which Feltmate said was "entirely a price story as prices at the pump fell 2.9%." Retail sales without auto and gas were up 0.2%, compared with views for a 0.3% increase.

Retail sales at electronics and appliance stores slipped 1.1% while clothing and accessory stores moved down 0.7%. Nonstore and miscellaneous retailers grew 1.4% and 1.7%, respectively, while department stores fell 1.1%.

"Based on the health of consumer spending alone, the (Federal Reserve) would have little reason for an aggressive start to the easing cycle, and we continue to lean toward a smaller move," BMO Capital Markets Senior Economist Sal Guatieri said. "However, policymakers have become increasingly worried about the rising jobless rate, and higher credit card and auto loan delinquency rates suggest that not all households are in a spending mood."

The Fed's monetary policy-setting committee meeting begins Tuesday with a decision on interest rates expected on Wednesday. There is a 65% chance the central bank will cut interest rates by 50 basis points, with the remaining odds in the favor of a 25-basis-point reduction, according to the CME FedWatch tool.