Retail Sales Tumble On Softer Gas Prices

The plunge in gasoline prices in March led retail sales to fall even as Americans spent more in bars, restaurants, and online stores.

Sales at U.S. retailers dropped one percent in March, the fourth decline in five months, according to data released by the government Friday, suggesting a slowdown in the U.S. economy and an ongoing shift in consumer spending away from goods to activities like dining out.

Economists had forecast a decline of half that size.

Sales at gas stations fell 5.5 percent in March but did not translate into higher sales in the broader retail market. Sales of new vehicles and parts fell by a sharp 1.6 percent.

Excluding gas stations and auto dealers, sales fell 0.3 percent. That was less of a decline than the 0.6 percent forecast.

Sales dropped 2.5 percent at department stores and 2.1 percent at electronics stores. Sales at garden centers and home materials stores were down 2.1 percent. Clothing store sales fell 1.7 percent.

Sales at general merchandise stores were off by three percent. Furniture store sales fell 1.2 percent.

Online store sales jumped 1.9 percent. Sales at bars and restaurants were up 0.1 percent. Sales at sports and hobby shops rose 0.2 percent. Health and beauty store sales rose 0.3 percent.

The data are adjusted for seasonality but not for changes in prices. In March, most measures of inflation showed pricing pressures eased and energy prices plunged, including a steep drop in gasoline prices.