Retail sales in the U.S. bet expectations, suggesting that consumers may be more eager to spend money as a result of a tight labour market and a minor slowdown in inflation.

Seasonally adjusted retail sales increased by 3.0% MOM in January to $697 billion, up from a decrease of 1.1% in December, according to new figures released by the Commerce Department on Wednesday. While economists' predictions hovered around 1.8%.

The amount spent at gas stations was unchanged from December but edged up by 5.7% from January 2022.

Discretionary spending, which includes cash spent at restaurants and on things like electronics, has spiked significantly.

Following a string of hawkish rate increases by the Fed, data released on Tuesday indicated that inflation in January slightly dipped to 6.4% year-over-year. But the rate of inflation continued to rise month over month.