U.S. retail sales increased unexpectedly in January as Americans spent more on cars, clothes and gasoline, indicating that the biggest part of the economy remains strong even as the housing market struggles, Bloomberg reported.

The 0.3 percent increase followed a 0.4 percent decrease the previous month, the Commerce Department said today. Excluding automobiles, purchases rose 0.3 percent after a 0.3 percent decline in December.

The figures may relieve concern that the United States has already slipped into recession because of a weakening labor market and declining home prices. Demand from consumers, whose spending accounts for about 70 percent of the economy, still is expected to lessen in coming months, forcing the Federal Reserve to lower interest rates further, economists said.

“Today’s report will diminish recession anxieties, but it doesn’t dispel them altogether,” said Richard DeKaser, chief economist at National City Corp. in Cleveland, who accurately forecast the sales gain. “The Fed will still likely cut rates in March because the preponderance of evidence, particularly the labor market, suggests recession risks remain.”

Retail sales were projected to fall 0.3 percent after an originally reported 0.4 percent decline in December, according to the median estimate in a Bloomberg News survey of 81 economists. Estimates ranged from a decline of 1.2 percent to a gain of 0.3 percent.

Today’s report showed sales at automobile dealerships and parts stores climbed 0.6 percent after a decrease of 1.1 percent in December. Gasoline sales rose 2 percent in January after remaining unchanged the prior month. Clothing retailers posted a 1.4 percent increase in sales. At grocery and beverage stores, sales were up 0.6 percent, the report showed.