* Sales rise 0.8 pct in November, "core sales" up 0.9 pct
* Sales ex-autos jump 1.2 pct, largest gain since March
* Producer prices PPI up 0.8 pct, core up 0.3 pct
* Economists raise growth projections on strong data (Adds Fed decision, updates markets)
By Lucia Mutikani
WASHINGTON, Dec 14 (Reuters) - U.S. retail sales rose for a fifth straight month in November as consumers hit the malls in droves at the start of the holiday shopping season, evidence the recovery gathered steam in the fourth quarter.
Sales rose a solid 0.8 percent as shoppers snapped up clothing, sporting goods and other items, data from the Commerce Department showed on Tuesday.
A separate report from the Labor Department showed producer prices increased 0.8 percent last month, above forecasts for a 0.6 percent gain. Core wholesale prices, excluding food and energy prices, rose a milder 0.3 percent.
The strong sales report, which contained upward revisions for both September and October, prompted economists to ratchet their fourth-quarter economic growth forecasts upward by as much as a full percentage point.
The economy grew at a tepid 2.5 percent annual rate in the third quarter, and some forecasters now expect growth around 3.5 percent in the final three months of the year.
"The fourth-quarter is shaping up to be relatively decent, probably north of three percent," said Ryan Sweet, a senior economist at Moody's Analytics in West Chester, Pennsylvania.
Stocks on Wall Street rose on the data, shrugging off a weak earnings report from Best Buy Co Inc (BBY.N). The top consumer electronics chain reported a decline in quarterly results and same-store sales and cut its full-year outlook. For details, see [ID:nN13207737]
The dollar pulled off three-week lows versus the euro, while the prices for U.S. government debt fell.
The sales data fit in with a string of recent reports suggesting the U.S. recovery was strengthening.
Federal Reserve policymakers on Tuesday viewed the pace of the recovery as still too slow to bring down a 9.8 percent unemployment rate. They reaffirmed their commitment to buy $600 billion in government debt to bolster the economy. [ID:nN14232588] <^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ For graphics, click on the links: U.S. retail sales: r.reuters.com/cax99q U.S. online retail sales: r.reuters.com/nax99q U.S. producer prices: r.reuters.com/bys99 Related stories: Year of the sweater sees rising retail sales [ID:nN14261032] Retail Federation raises holiday forecast: [ID:nN14271743] Best Buy's sales raise holiday concerns [ID:nN13207737] ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>
AUTOS HOLD SALES BACK
Auto sales in November fell 0.8 percent, partially reversing October's out-sized 5.6 percent gain.
Excluding autos, sales increased 1.2 percent, the largest rise since March and double economists' forecasts.
Sales last month were buoyed by a 2.7 percent rise in receipts at clothing and clothing accessories stores, the largest increase since March. Spending on non-essential goods was also up, lifting sales at sporting goods, hobby, book and music stores 2.3 percent, the biggest gain in almost a year.
A 4 percent jump in gasoline station receipts -- the largest in a year -- also lifted the overall sales count.
Core retail sales, which exclude autos, gasoline and building materials, rose 0.9 percent after a 0.5 percent gain in October. These correspond most closely with the consumer spending component of the government's GDP report.
Though economists cautioned that sales could drop in December, they said fourth-quarter consumer spending growth would far exceed the 2.8 percent rate recorded in the July-September period.
"For the first time since the recession ended, consumers are contributing to growth in a real way," said Chris Low, chief economist at FTN Financial in New York.
Economists expect the tax deal struck last week by the Obama administration and Republican lawmakers to boost spending next year, keeping growth on an upward trajectory even as the boost from a rebuilding of inventories wanes.
A second report from the Commerce Department showed business inventories rose by a less-than-expected 0.7 percent in October. Should the pace of inventory accumulation continue to slow in the next two months, that could temper the upbeat growth estimates for the fourth quarter. [ID:nN14249682] (Additional Reporting by Pedro Nicolaci da Costa; Editing by Chizu Nomiyama)