WASHINGTON : US retail sales rose 0.3 percent in January, a government report showed on Wednesday, as shopping activity rebounded unexpectedly despite growing economic worries.

The monthly snapshot was better than expected as most economists had expected retail sales to decline 0.3 percent following a 0.4 percent drop in December.

Retail sales are tracked closely by economists to assess consumer spending which is a vital economic driver.

Excluding automobile sales, which can fluctuate strongly, sales were also up 0.3 percent, according to the Commerce Department survey.

The government revised sales, excluding autos, during December to show a decline of 0.3 percent instead of an initial estimate of a 0.4 percent drop.

The rise in overall sales and sales excluding autos marked the strongest gains since November.

The readings are likely to support the assumptions of some economists who believe the economy will avoid a recession. Other economists believe the world's biggest economy is on the verge or has already fallen into a recession.

The Federal Reserve has cut interest rates aggressively in recent months amid a slowdown in growth in a bid to boost economic momentum which relies heavily on consumer spending.

Overall sales got a boost in January as auto sales rebounded and as service station sales posted a gain.

Auto sales rose 0.6 percent last month compared with a sharp 1.1 percent decline in December while service station sales increased 2.0 percent after remaining steady in the prior month.

A rebound in clothing sales also helped pump up overall sales activity.

Clothing store sales rebounded 1.4 percent last month following a 2.3 percent drop in December.

The rebound in clothing sales suggests consumers responded to retailers' tantalising incentives last month, as many retailers slashed prices in a bid to pare their inventories.

In the 12 months to January, overall sales rose 3.9 percent in January and were up 4.9 percent excluding autos. - AFP/de