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Economy in Brief

U.S. Retail Sales Strengthen; Core Sales Strongest Since 2006
by Tom Moeller April 14, 2010

Forward momentum is building behind consumer spending. March retail sales rose 1.6%; triple the upwardly revised readings of the prior two months and stronger than the 1.2% increase that had been expected. On a three-month basis sales rose at an 11.0% annual rate. Nonauto sales rose 0.6% but the February increase also was revised up to 1.0% after an upwardly revised 0.6% January increase. The latest gain was near expectations. On a three-month basis the gain in nonauto sales remained strong at 9.3% (AR). These numbers were, of course, helped by moderation in gasoline prices. Nonauto retail sales less gasoline, a better measure of "core" spending, grew 0.7% last month and at a 10.2% annual rate during the last three, the strongest since January 2006.

"Core" discretionary spending improved. Apparel store sales rose 2.3% during March and at a 22.1% annual rate during the last three months. General merchandise store sales also rose a firm 0.6% and at a 11.9% three-month rate. Sales at furniture, home furnishings & electronics stores lagged these gains last month. They were unchanged but were up at a 9.8% annual rate over the last three months. That's improved from the 9.6% decline during all of last year. Furniture sales alone have been rising at a 14.5% rate while sales of electronics & appliances have been rising at a 15.4% rate.

Mirroring the improvement in unit sales, motor vehicle sales improved considerably by 6.6% last month and at a 19.8% rate during the last three. Finally, growth in sales at gasoline service stations fell 0.4% and rose at just a 2.7% rate during the last three months.

Earlier strength in internet & catalogue sales continued to ease. Sales ticked up just 0.2% and the three-month rate of gain backed off to 7.3%, one third the growth earlier this year.

The retail sales data are available in Haver's USECON database

  March February January March Y/Y 2009 2008 2007
Total Retail Sales & Food Services (%) 1.6 0.5 0.5 7.6 -6.0 -0.8 3.3
  Excluding Autos 0.6 1.0 0.6 6.4 -4.8 2.4 3.9
Non-Auto Less Gasoline 0.7 1.1 0.6 4.2 -1.9 1.6 3.6
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