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U.S Retail Sales Falls for Third Straight Month

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U.S. retail sales unexpectedly fell in February for a third month, adding to signs that consumer spending will cool this quarter from the previous period’s hot pace, according to Commerce Department figures released Wednesday.

HIGHLIGHTS OF RETAIL SALES (FEBRUARY)

  • Overall sales fell 0.1% (est. up 0.3%) after 0.1% decrease in prior month (prev. down 0.3%); Dec. figure revised to down 0.1%
  • Purchases at automobile dealers fell 0.9%, the second straight month with such a reading
  • So-called retail-control group sales, which are used to calculate GDP and exclude food services, auto dealers, building materials stores and gasoline stations, rose 0.1% (est. up 0.4%) following unchanged
    Seven of 13 major retail categories showed declines

    • Key Takeaways

    The results indicate consumer spending, the biggest part of the economy, is easing after strong gains in the fourth quarter. Shoppers may be taking a breather following a run-up in borrowing in late 2017, and relatively tepid wage growth is limiting Americans’ purchasing power.

    In addition to declines at auto dealers and gas stations, February’s figures reflected lower demand at furniture and home furnishing stores, electronics and appliance vendors, food and beverage sellers and health and personal care stores. General merchandise stores saw a 0.4 percent decline in receipts, the most since May, following a similar advance in January.

    On the brighter side, building-material stores reported a 1.9 percent sales gain in February, following a 1.7 percent decline.

    Even with the latest sluggish sales figures, job-market strength, rising property values and lower taxes are buoying Americans’ sentiment and should support steady gains in spending. Consumption was probably sufficient to keep Federal Reserve policy makers on track for a widely expected interest- rate increase next week.

    Other Details

  • Excluding automobiles and gasoline, sales rose 0.3 percent, matching forecasts, after a 0.1 percent decline the previous month
  • Receipts at gasoline stations fell 1.2 percent

    • Bloomberg

    This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

    Dean Popplewell

    Dean Popplewell

    Vice-President of Market Analysis at MarketPulse
    Dean Popplewell has nearly two decades of experience trading currencies and fixed income instruments. He has a deep understanding of market fundamentals and the impact of global events on capital markets. He is respected among professional traders for his skilled analysis and career history as global head of trading for firms such as Scotia Capital and BMO Nesbitt Burns. Since joining OANDA in 2006, Dean has played an instrumental role in driving awareness of the forex market as an emerging asset class for retail investors, as well as providing expert counsel to a number of internal teams on how to best serve clients and industry stakeholders.
    Dean Popplewell

    @dean_forex

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