With auto sales rebounding strongly, the Commerce Department released a report on Monday showing retail sales in the U.S. increased by more than anticipated in the month of March.
The report said retail sales climbed by 0.6 percent in March after edging down by 0.1 percent in February. Economists had expected retail sales to rise by 0.4 percent.
The stronger than expected retail sales growth was primarily due to the rebound in sales by motor vehicle and parts dealers, which surged up by 2.0 percent in March after slumping by 1.3 percent in February.
Excluding the jump in auto sales, retail sales edged up by 0.2 percent in March, matching the uptick seen in the previous month as well as economist estimates.
The modest increase in ex-auto sales partly reflected a 1.4 percent spike in sales by health and personal care stores.
Sales by non-store retailers and furniture and home furnishing stores also saw notable growth, although the increases were partly offset by a steep drop in sales by sporting goods, hobby, book and music stores.
Closely watched core retail sales, which exclude automobiles, gasoline, building materials and food services, rose by 0.4 percent in March after coming in unchanged in February.
“Overall, consumer spending has been disappointing in 1Q18, which is partially weather-related, but today’s report suggests the slowdown was transitory,” said James Knightley, Chief International Economist at ING.
“We remain upbeat for the coming months,” he added. “Consumer confidence is high, supported by strong employment gains, rising wages and tax cuts. As such we look for a more positive contribution from consumer spending to overall GDP growth in 2Q18.”
Compared to the same month a year ago, retail sales were up by 4.5 percent in March compared to the 4.1 percent year-over-year increase in February.
by RTTNews Staff Writer
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