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Economy in Brief

U.S. Retail Sales Are Restrained As Gas Prices Surge in February
by Tom Moeller  March 16, 2022

• Individual categories show mixed results.

• Vehicle sales improve.

• Online sales weaken.

Total retail sales including food service and drinking establishments improved 0.3% in February (17.6% y/y) after surging 4.9% in January, revised from 3.8%. A 0.4% sales increase had been expected in the Action Economics Forecast Survey. Sales excluding motor vehicles and parts edged 0.2% higher last month (17.7% y/y) following a 4.4% January jump, revised from 3.3%. Expectations had been for a 0.8% increase.

Sales in the retail control group, which excludes autos, gas stations, building materials and food services, declined 1.2% in February (+12.9% y/y) after rising 6.7% in January, revised from 4.8%.

Reflecting higher prices, gasoline service station sales surged 5.3% (36.4% y/y) after falling 1.7% in January. Gasoline prices rose 6.6% last month (38.0% y/y) as indicated in last week's CPI report.

The weakness in retail sales last month reflected a 3.7% decline (+13.8% y/y) in purchases via the internet after they strengthened 20.6% in January. Furniture & home furnishing store sales weakened 1.0% (+7.4%  y/y) after increasing 7.5% in January. Electronics & appliance store sales eased 0.6% (+2.6% y/y) following a 2.1% jump. General merchandise store sales slipped 0.2% last month (+12.8% y/y) after a 4.5% January strengthening. Within that category, department store sales improved 1.6% (22.8% y/y) in February after a 9.8% surge in January.

To the upside, motor vehicle sales rose 0.8% (17.2% y/y) in February after strengthening 6.9% in January. Unit motor vehicle sales, however, fell 6.9% last month (-12.3% y/y) after rising 19.6% in January. Sporting goods, hobby and book store sales rose 1.7% (11.7% y/y) last month after a 1.3% decline. Apparel & accessory store sales improved 1.1% (30.6% y/y) after increasing 1.4% in January. Building materials & garden equipment sales rose 0.9% in February (14.8% y/y) after a 2.7% January rise.

In the nondiscretionary sales categories, food & beverage store sales fell 0.5% (+7.9% y/y) during February after rising 1.0% in January. Health & personal care store sales declined 1.8% (+8.9% y/y) after improving 0.2% in January.

Sales at restaurants & drinking establishments strengthened 2.5% in February (33.0% y/y) after falling in three of the prior four months.

The retail sales data can be found in Haver's USECON database. The Action Economics forecast is in the AS1REPNA database.

Retail Spending (% chg) Feb Jan Dec Feb Y/Y 2021 2020 2019
Total Retail Sales & Food Services 0.3 4.9 -2.7 17.6 19.4 0.2 3.3
  Excluding Autos 0.2 4.4 -3.0 17.7 18.4 0.3 3.4
Retail Sales 0.0 5.7 -3.0 15.9 18.0 3.1 3.0
 Retail Less Autos -0.2 5.3 -3.4 15.5 16.5 3.9 3.0
  Motor Vehicle & Parts 0.8 6.9 -1.5 17.2 23.3 0.2 2.9
  Food & Beverage Stores  -0.5 1.0 -0.1 7.9 4.5 11.5 3.1
  Gasoline Service Stations 5.3 -1.7 1.2 36.4 36.1 -16.0 -1.7
Food Service & Drinking Places 2.5 -1.0 -0.3 33.0 31.6 -19.6 5.6
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