According to the U.S. Department of Commerce, March sales rose 1.1% to $433.9 billion. In fact, overall level of spending actually surpassed sales in November, a key month for holiday selling.
The so-called core retail sales, which exclude automobiles, gasoline, building materials and food services, and correspond most closely with the consumer spending component of gross domestic product, increased 0.8% in March. (February’s core retail sales were revised to show a 0.4% rise instead of the previously reported 0.3% gain.)
Economists noted that March sales were led by pent-up demand in auto sales. But gains were across category—only gas stations and electronic stores reported declines.
Sales at clothing and accessories stores were up 1% and were up 2.1% adjusted year-over-year.
General merchandise retailers posted a 1.9% gain, the biggest since March 2007. Department stores were up 0.5% but down 3.4% compared with a year ago.
“This suggests that household spending ended the quarter on very solid footing after the wobbles in the two previous months,” said Millan Mulraine, deputy chief economist at TD Securities. “This momentum is likely to continue over the next month or two as the warmer weather provides further impetus for spending, which will ensure that personal spending activity continue to provide a key source of support for economic activity.”
While expectations were that a later Easter this year compared to Easter in March last year would hinder sales, it evidently didn’t. Moreover, Easter may give April sales an even greater boost.
“Retail sales increased in most categories and sectors as consumers took to stores to purchase new spring attire and home furnishings in hopeful expectation of warmer weather,” said NRF President/CEO Matthew Shay. “Sales should continue to remain positive this spring with the approach of Easter and expected tax refunds.”
“Improving economic conditions and consumer confidence should push consumers to return to spending habits this spring,” NRF Chief Economist Jack Kleinhenz said. “Consumers released some pent-up demand in March after two consecutive months of harsh winter weather that not only hampered employment opportunities but also retail sales. We remain optimistic that retail sales will continue their positive march this spring.”