Retail sales, which had been expected to gain a solid 0.8% last month, instead surged by an even more formidable 1.1% in March. That increase, meanwhile, was the biggest one-month uptick since September of 2012.
Looked at on a month-to-month basis, this latest rise was notably greater than the February gain of 0.7%. In fact, that healthy February increase had been revised up from an initially estimated 0.3% rise. In January, sales had fallen by 0.7%. So, there has been a steady upward progression since the weather-impacted January results.
Breaking the report down, we see that sales were up by a more modest 0.7% last month, if we back out the high-cost automotive component. This increase in so-called core retail sales of 0.7%, meantime, was much better than the 0.4% rise generally forecast. A core increase of 0.3% had been seen in both January and February.
Also showing nifty strength last month were, obviously, sales of motor vehicles and parts, but also furniture and home furnishings (up 1.0%), building materials and garden equipment (up 1.8%), clothing and accessories (ahead 1.0%), and general merchandise (which chipped in with an increase 1.9%). Also, non-store retail activity (i.e., business done over the Internet) gained strongly, as well, increasing by 1.7% last month. That was an even greater upsurge than the respective gains of 1.6% and 1.2% recorded in February and January.
Weakness, albeit not widespread, was noted in sales at gasoline stations, which likely reflected lower prices for that commodity, at miscellaneous store retailers (off 1.3%) and at electronics stores (lower by 1.6%), following gains in February.
Looked at on a year-to-year basis, aggregate retail sales were up a solid 3.7% from last year at this time. But a far bigger gain was recorded both by motor vehicle dealers (up 9.5%) and at non-store retailers (ahead 7.8% from last year). It should be noted that the next look at retail spending will be on May 13th.
Looked at in its entirety, this was a strong report with few weaknesses and, along with the sizable upward revision for February, now suggests that first-quarter GDP growth figures, which will be out later this month, may show growth that could be closer to the 2% area, than the 1%-2% we have been looking for.
At the time of this article's writing, the author did not have positions in any of the companies mentioned.