U.S. retail sales rose more than expected in March as Americans shrugged off high gasoline prices and bought a range of goods, suggesting that economic growth in the first quarter did not slow as much as many had feared.
Total retail sales increased 0.8 per cent from the previous month, the Commerce Department said on Monday, after a slightly downwardly revised 1.0 per cent rise in February that was previously reported as a 1.1 per cent advance.
Last month’s gains, which surpassed economists’ expectations for only a 0.3 per cent rise, could prompt analysts to raise their first-quarter growth forecasts from an annual pace of around 2.5 per cent currently.
The economy grew at a 3.0 per cent rate in the fourth quarter.
The rise in sales last month was broad-based, even though Americans paid 27 cents more per gallon of gasoline than they did the prior month.
So far, Americans appear to be taking rising gasoline prices in their stride, thanks to a mild winter that has cut heating bills for households.
Motor vehicle sales rose 0.9 per cent after increasing 1.3 per cent in February. Auto sales have accelerated in recent months, boosted by pent-up demand by households.
A devastating earthquake and tsunami in Japan caused disruptions to auto production last year and left dealers without models that consumers wanted to buy.
Excluding autos, retail sales climbed 0.8 per cent last month after advancing 0.9 per cent in February.
Elsewhere, gasoline sales receipts increased 1.1 per cent after rising 3.6 per cent in February. Excluding autos and gasoline, sales advanced 0.7 per cent in March, adding to the prior month’s 0.5 per cent gain.
Details of the report showed some strength, suggesting consumer spending will continue to support growth.
Last month, clothing store receipts rose 0.9 per cent, while sales at building materials and garden equipment suppliers jumped 3.0 per cent - the largest gain since December.
Unseasonably mild weather has helped to boost sales at clothing retailers as well as purchases of building materials and garden equipment.
So-called core retail sales, which exclude autos, gasoline and building materials, rose 0.5 per cent after increasing by the same margin in February.
Core sales correspond most closely with the consumer spending component of the government’s gross domestic product report.
Sales at restaurants and bars edged up 0.3 per cent, while receipts at sporting goods, hobby, book and music stores rose 0.5 per cent. Sales of electronics and appliances increased 1.0 per cent - the largest gain since October, while receipts at furniture stores climbed 1.1 per cent.
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