Wal-Mart Stores Inc., the world’s largest retailer, cut its August sales forecast because of Hurricane Charley and sluggish demand for back-to-school products.

The Bentonville, Ark.-based discounter said American sales will be little changed or increase by as much as 2%, which would be the smallest gain in 17 months. Sales at 200 locations were hurt when Hurricane Charley hit Florida on August 13, Wal-Mart said in a recorded call.

Wal-Mart previously forecast August sales would increase as much as 4%. Wal-Mart’s American sales averaged 5.6% in the first five months of the year before slowing in June.

Second-quarter sales gains were limited because of the gasoline prices and a lack of new tax cuts, which spurred spending in last year’s second quarter, Wal-Mart Chief Executive H. Lee Scott said on a recorded call earlier this month.

Wal-Mart sales are twice as sensitive to higher gasoline prices than the overall industry’s sales because the retailer’s customer base includes many lower-income families, said Michael Niemira, chief economist of the Inter national Council of Shopping Centers.

The median family income for the average Wal-Mart shopper is about $44,000 a year, compared with about $55,000 for No. 2 U.S. discounter Target Corp.’s customers, said Howard Davidowitz, chairman of consulting firm Davidowitz & Associates in New York.

The average price of regular gasoline

reached a record $2.10 a gallon on May 24 before declining gradually to $1.88 for the week of August 16. In December 2001, just after the most recent recession, gasoline averaged $1.10 a gallon.

Job growth slowed in June and July. The economy created an average of 55,000 jobs during the two months, compared with 225,000 a month from January through May, Labor Department figures show.

Uniforms and athletic shoes were among back-to-school products with strong sales, the company said. Wal-Mart spokeswoman Sharon Weber declined to provide more details.

“Wal-Mart’s problem is they have to get their apparel strategy stronger for the whole kids category,” said Britt Beemer, chairman of America’s Research Group, a Charleston, S.C., market research group. “Weakness in apparel has probably hurt them and is really now coming to surface more than it has in the past.”

August sales will be damped by Labor Day falling later this year and a reduced amount of merchandise for clearance, Wal-Mart said.

Wal-Mart earlier this month forecast profit from continuing operations of 52 cents to 54 cents a share for the third quarter as same-store sales rise as much as 5%.