U.S. retail for January and February revised downwards

U.S. retail for January and February revised downwards

American consumers are showing renewed signs of caution amid continued financial-market volatility, clouding the outlook for a segment of the economy that had been a bright spot.

U.S. retail sales fell in February and figures for January were revised down sharply amid a drop in spending on gasoline and autos, according to Commerce Department data released on March 15, 2016.

Sales at retail stores and restaurants fell 0.1 % from the prior month to a seasonally adjusted USD 447.31 billion in February, the report said. January retail sales dropped 0.4 %, versus the initially reported 0.2 % increase.

The latest snapshot of consumer spending recasts what had seemed a more upbeat start to 2016.

Retail sales are a key barometer for overall consumer spending, which accounts for about two-thirds of economic output in the U.S. American households have benefited from cheaper gasoline—the average weekly price of a gallon fell to the lowest level in seven years last month—and steady job creation.

Excluding motor vehicles, retail sales were down 0.1 % in February. Excluding gasoline, sales were up 0.2 %. Excluding both categories, sales grew 0.3 % last month.

Americans spent more on an array of goods, including building materials and garden equipment; sporting goods, books and music; health and personal care items; and clothing. Restaurants and bars also saw a bump in sales.

And overall, consumer spending is still contributing to economic growth. February sales excluding gasoline, for example, were 4.8 % higher than a year earlier.

The Federal Reserve closely watches consumer-spending data as a gauge of economic growth, and Fed officials pointed to solid outlays as a factor in their decision to raise interest rates in December for the first time in nearly a decade.

Fed officials are meeting March 15 and 16, 2016 to determine their next step on rates. Economists do not expect them to make any moves.

The retail-sales data are adjusted for seasonal variations but not for price changes. The report does not include estimates for most services, which make up the bulk of consumer spending.


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