Retail Sales Surge in March, Reaching Fastest Pace Since 2017
Americans went on a buying binge in March, and their spending on cars, furniture and clothing resulted in the strongest increase in sales since September 2017, the Commerce Department said Thursday morning.
Overall, sales increased by a seasonally adjusted 1.6 percent during the month, and even when excluding the volatile auto and gasoline sectors, sales by retailers still posted a solid 0.9 percent gain.
Economists consider this report suggests that consumers feel confident enough about their finances to maintain their spending, overcoming fears after retail sales in December plunged 1.6 percent.
Sales rebounded somewhat in January, only to decline again in February.
During the past year, retail spending has grown 3.6 percent, the Commerce Department said.
Earlier this month, the Federal Reserve reported that consumer credit increased at a seasonally adjusted annual rate of 4.5 percent. The Fed’s monthly G-19 report said revolving credit increased at an annual rate of 3.25 percent, while non-revolving credit increased at an annual rate of 5 percent.
“March’s numbers are very encouraging and set the stage for improved expectations for the economy in the coming months, especially since the first quarter is typically weak,” said Jack Kleinhenz, chief economist for the National Retail Federation.
“These numbers boost first-quarter performance and suggest a [confident] consumer,” Kleinhenz continued. “It is clear that underlying consumer fundamentals including job and wage growth and healthy household balance sheets continue to support spending. Consumers were busy in March after weaker-than-expected spending earlier.”
He went on to suggest the numbers could have been better if not for cold weather early in March and changes in the timing of two key religious holidays.
“The change of seasons is always a factor because of the weather, and a later Easter and Passover this year mean holiday-related sales that took place in March last year won’t come until April this year and sizably impact year-over-year comparisons,” Kleinhenz explained.
Bloomberg economists Yelena Shulyatyeva and Carl Riccadonna wrote Thursday that “Stronger-than-expected retail sales in March that spanned multiple discretionary spending categories confirm that the slowdown at the start of the year was temporary.
“As transitory factors abated — including a lengthy government shutdown and a shock to household confidence in response to the fourth-quarter market rout — consumer spending recovered in full force,” they said.
Sales at auto dealers jumped 3.1 percent in March, while gas stations saw their sale climb 3.5 percent.
Spending at clothiers reported a 2 percent gain and furniture stores witnessed a 1.7 percent jump in sales.
Out of 13 retail categories, only one — sporting goods, hobby, musical instrument and book stores — reported a sales decline.
Spending at department stores was unchanged in March. Purchases in the sector that includes online businesses enjoyed a 1.2 percent increase. Restaurants saw their sales improve 0.8 percent.
“Retail sales ended 2018 abysmally and began 2019 extraordinarily,” Jefferies LLC economists Ward McCarthy and Thomas Simons wrote in a note. “With a boost from January and March, the consumer sector will be a source of growth again in the first quarter.”
In The News
The governors of five northeastern states came together for a summit on Thursday to discuss the outlines of a joint regional approach to cannabis and vaping policies. "This issue is complicated, controversial and consequential. It is probably one of the most challenging I've had to address... Read More
FRANKLIN, Tenn. — Kat Merryfield was ready to share her farm-to-home oils, chocolates and creams with the rest of the country. But banks and credit card processors weren’t ready to work with her small business. “We started out our website with PayPal, and it took about... Read More
WASHINGTON - If Democrats want to hold their majority in House in 2020 they'll focus on core issues important to their constituents like protecting healthcare coverage, fighting corruption, and expanding economic opportunity, according to a new analysis by Third Way, the public policy think tank. In... Read More
WASHINGTON — The International Monetary Fund on Tuesday downgraded its outlook for the world economy, predicting that growth in the developed world this year, stymied by trade conflicts, will be the weakest since the 2008 financial crisis. During a press conference Tuesday morning, IMF Chief Economist... Read More
Mark Tuttle cuts straight to the point when describing the field and weather conditions he has faced this year on his farm in southern DeKalb County. “In one word, I’d say: ‘miserable,’ ” said Tuttle, who grows corn, soybeans and wheat on about 1,000 acres near... Read More
WASHINGTON — Kristalina Georgieva, the new head of the International Monetary Fund, said Tuesday that the world economy is in the grips of a "synchronized global slowdown" fueled by ongoing trade disputes. Speaking at the World Bank/IMF annual meetings being held in Washington, D.C. this week,... Read More