Retail sales continue to dip

The Commerce Department reported Tuesday that retail sales dipped 0.2 percent last month, right in line with economists' expectations.

It was the second drop in the past three months and was led by a 2.8 percent decline in auto sales, the biggest setback in this category in 10 months. It reflected the problems that automakers are having as a weak economy and soaring gasoline prices cut into demand for new cars.

Excluding autos, retail sales rose by 0.5 percent, a better performance than had been expected as sales at general merchandise stores, a category that includes big chains such as Wal-Mart, posted a 0.5 percent increase, much better than the tiny 0.1 percent rise in March.

However, sales at department stores were down 0.1 percent, indicating that tough economic times may be pushing people to seek out bargains at giant discount stores.

Many analysts believe the economy has slipped into a recession. However, overall economic growth, as measured by the gross domestic product, has not yet turned negative.

The Bush administration is hoping that a $168 billion economic stimulus package, which includes about $100 billion in direct payments to households, will give the economy a jump-start. The government started making those payments at the end of April.

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