U.S. retail sales increased at a torrid rate last month, nearly tripling analysts expectation.

Retail sales increased by a seasonally adjusted 2.3% after rising a downwardly revised 0.4% in December, the U.S. Commerce Department said today. Sales were originally seen 0.7% higher during December.

The broad-based January increase, with sales up in nearly every category, was the biggest since May 2004, when demand also rose 2.3%. Economists had expected a modest 0.8% increase in January retail sales.

January auto and parts sales rose by 2.9%, after climbing 1.2% in December.

But demand rose strongly outside autos, too. Excluding the car sector, all other retail sales increased by 2.2% in January — the largest climb since a 2.5% gain in that category during December 1999.

Meanwhile, U.S. business inventories rose higher than expected during December. Inventories increased by a broad-based 0.7% to a seasonally adjusted US$1.304 trillion, after a 0.6% advance in November, the Commerce Department said. November inventories were originally seen up 0.5%.

Economists had forecast for stockpiles to move upward 0.4% during December. Business sales advanced by 1.2% during December, rising to US$1.045 trillion. It was the biggest gain since December 2004’s 1.2% increase. Sales increased 0.3% in November, revised up from a previously reported 0.1% climb.

Year over year, sales grew 7% during the 12 months as opposed to a 4.3% rise in stockpiles.