Americans cut spending at retailers for the third consecutive month despite receiving bigger paychecks, a sign the economy lost a bit of momentum early this year.
Retail sales, excluding motor vehicle and parts, fell 0.1% in February and rose 4.2% from February a year ago, according to the U.S. Department of Commerce's monthly report, released Wednesday. Economists surveyed by The Wall Street Journal expected sales to rise 0.3%.
By category: furniture sales fell 0.8% from January and rose 3.3% year over year; electronics and appliance sales fell 0.1% from January and rose 4.5% year over year; department store sales fell 0.9% from January and were flat year over year; and apparel sales rose 0.4% from January and 4.9% year over year. That was followed by gas stations with a 7.9% increase. Excluding vehicles and fuel, sales rose by 0.3 per cent.
A month-over-month drop in vehicle sales, which were down 0.9 percent, accounted for all of the slight monthly decline in total retail sales.
US' Stiff Tariffs on Steel Imports
For one thing, Vertical notes that the list of countries and products being exempted from the tariffs is "growing". Some countries subsidize their steel producers and allow them to sell steel at unfairly low prices.
Also, consumers who boosted spending last fall to fix and replace property damaged by hurricanes in the South may have temporarily cut back since then.
Wednesday's report showed declines in spending at vehicle dealers, furniture stores, health stores, gasoline stations, and department stores.
Stimulus in home-related spending has also fueled sales at major home improvement chains like Home Depot and Lowes, both of which saw growth in same-store sales over the latest quarter. There were other factors last month that made this year better for retailers. "With consumer confidence and employment growing, economic fundamentals are favorable for spending to expand in the coming months".
Sporting goods stores were down 3.4 percent year-over-year but up 2.2 percent from January seasonally adjusted.