Growth in retail sales stalled in August after a pitched battle over spending in Congress undermined faith that the government could steer the country clear of a double-dip recession, Reuters reported.

Sales were unchanged from a month earlier, a report from the U.S. Department of Commerce showed. It was a weaker reading than expected after sales growth during July was revised downward.

Consumer confidence plunged in August after a battle over the U.S. debt ceiling slammed stock prices and pushed the nation to the brink of default.

Consumer spending accounts for about two-thirds of U.S. economic activity, and the data suggests growth in the first two months of the third quarter was weaker than many economists expected.

An increase in sales of electronics, gasoline and food was balanced with drops in purchases of cars, furniture and clothes. Spending at restaurants and bars also fell.

A separate report from the U.S. Department of Labor showed U.S. producer prices were unchanged in August, held down by a drop in the cost of energy goods.