US retail sales fall in March as auto sales drag

There was a 2.1% drop in motor vehicle sales throughout March, according to the Commerce Department
AFP

Washington (AFP) – US retail sales fell in March, dragged down by the auto sector, according to official data Wednesday that suggested tepid consumer spending.

The Commerce Department said retail and food services sales fell 0.3 percent in March and after sales in February were flat.

The month-over-month decline was due to a 2.1 percent drop in motor vehicle sales. Stripping out autos, retail sales rose 0.2 percent, lifted mainly by rising gasoline prices.

Retail sales are a snapshot on US consumer spending, the main motor of the economy that accounts for two thirds of activity.

“Retail sales continue to be hobbled by a widespread lack of pricing power, past stock market declines, and the end of growth in vehicle sales,” said Scott Hoyt of Moody’s Analytics. 

Analysts had forecast a 0.1 percent rise for all sales and 0.4 percent for ex-auto sales.  

Year-over-year, retail sales were up 1.7 percent in March, the weakest growth since November, Hoyt noted. Total sales in the first quarter were up 2.8 percent from the year-ago quarter.

“The weaker than expected data for March were partly offset by the revisions to control in January and February but the net result is still a fairly weak quarter,” said Jim O’Sullivan, chief US economist at High Frequency Economics.

Gasoline sales at the pump rose 0.9 percent in March as oil prices lifted off February lows.

Building material and garden supply stores rang up a 1.4 percent gain. Other increases registered included sales at health and personal care stores and general merchandise stores.

Outside of falling auto sales, the sharpest declines were at restaurants and bars, down 0.8 percent. Online sales dipped 0.1 percent.

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