Reporting the first real improvement in three months, the U.S. Department of Commerce said today that February retail sales rose 0.3% to $427.2 billion. That beat economists’ estimate for a 0.2% increase. And the sales total was 1.5% above February 2013.
Clothing, Accessories Show Gains, Too
The cold, wintry weather that afflicted much of the country took a break in mid-February. That along with decreases in unemployment and improved consumer confidence may have helped retail sales last month, economists said.
“Despite a long and cold winter, consumers continued to persevere and spend in February,” NRF Chief Economist Jack Kleinhenz said. “This month’s retail sales data is encouraging and above expectations. However neither the jobs nor retail data reflect the fundamental health of the economy. While the weather continues to play tricks on economic forecasts and figures, we expect much-needed clarity come spring as consumers release pent-up demand.”
A closer look at the so-called core retail sales, which exclude autos, gas, building material and food services, shows a 0.3% increase, which followed a revised 0.6% drop in January.
Of the 13 major categories tracked by the Commerce Department, nine of them showed increases, including “clothing and clothing accessories,” where sales were up 0.4% compared to January and were up 2.4% compared to February 2013.
Increases at non-store retailers, which includes online, continued to be strong, rising 1.2% from January and up 6.3% from February a year ago.
General merchandise retailers were down 0.3% from January and 0.8% from February a year ago.
However, department stores posted a 0.7% gain from January helped by a pickup in traffic over the last half of February. But compared to February last year, department store sales were actually down 4.8% reflecting the drop off in traffic in malls and other shopping centers.
NRF President CEO Matthew Shay, president /ceo at NRF noted, “Today’s positive retail sales report indicates that the economy is primed for growth. Retailers and consumers endured the harsh winter and they’re hoping both the natural and man-made obstacles to growth will leave with the snow.”
On the other hand, Russell Price, senior economist at Ameriprise Financial Inc.—who Bloomberg calls “the best forecaster of retail sales over the past two years—said, “We’ll see a little bit more traction on the consumer side as the weather improves and people get a little bit more willing to leave the house, but the gain in February has to be considered against the negative revisions to January and December.