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Unexpected retail sales drop suggests growth slowdown

Retail sales drop suggests lower growth

U.S. retail sales recorded their biggest drop in more than nine years in December as receipts fell across the board, suggesting a sharp slowdown in economic activity at the end of 2018.

The shockingly weak report from the Commerce Department on Thursday led to growth estimates for the fourth quarter being cut to below a 2.0 percent annualized rate.

December’s collapse in retail sales and other data showing an unexpected increase in the number of Americans filing claims for unemployment benefits last week and a second straight monthly decline in producer prices in January support the Federal Reserve’s pledge to be “patient” before raising interest rates further this year.

Retail sales tumbled 1.2 percent, the largest decline since September 2009, when the economy was emerging from recession. Sales edged up 0.1 percent in November.

Economists polled by Reuters had forecast retail sales gaining 0.2 percent in December.

— Reuters

Airbus to end production of A380

European plane maker Airbus said Thursday it will stop making its superjumbo A380 in 2021 for lack of customers, abandoning the world’s biggest passenger jet and one of the aviation industry’s most ambitious and most troubled endeavors.

Barely a decade after the double-deck, 500-plus-seat plane started carrying passengers, Airbus said that key client Emirates is cutting back its orders, and as a result, “we have no substantial A380 backlog and hence no basis to sustain production.”

The decision could affect up to 1,000 jobs and already cost plane maker 463 million euros (about $523 million) in losses in 2018, Airbus said.

The company, a European economic powerhouse, is also girding for serious disruption to its cross-continental manufacturing from a likely chaotic British exit from the European Union next month.

The end of the young yet iconic jet is a boon for rival Boeing and an embarrassing symbolic blow for Airbus.

— Associated Press

General Motors announced on Thursday that its brand of electric bicycles would be called "Ariv" and begin selling in Europe in the second quarter of 2019. Two such bicycles, a compact bike and a foldable one, will launch first in Germany, Belgium and the Netherlands, markets where cycles powered by lithium-ion batteries are already popular, the No. 1 U.S. automaker said.

Coca-Cola forecast full-year profit well below Wall Street expectations on Thursday as it reported a quarterly decline in volumes in North America. Food packaging companies are facing the brunt of rising freight and commodity costs and a dearth of truck drivers. To counter these costs, Coke raised prices of its beverages, but that came at the expense of falling demand.

Discount retailer Payless ShoeSource plans to close all of its approximately 2,300 stores when it files for bankruptcy later this month for the second time in as many years, people familiar with the matter said Thursday. The move would make Payless one of the most high-profile victims of the string of bankruptcies that have hit the bricks-and-mortar retail sector as more shopping is done online.

Austria's antitrust agency says it has initiated an investigation into online retailer Amazon over complaints of unfair trade practices on its "Marketplace" platform. The investigation comes amid ongoing probes by German antitrust authorities and the European Commission. (Amazon chief executive Jeffrey P. Bezos owns The Washington Post.)

— From news services