Photo: Revisorweb via Wikimedia Commons

Photo: Revisorweb via Wikimedia Commons

Retail sales in the U.S. fell for the third straight month in February as harsh weather in much of the country kept consumers and their wallets at home.

A new Commerce Department report shows a decline of 0.6% from January, due in large part to a 2.5% drop in sales of new autos along with declines at department stores and electronics and appliances retailers of 1.4% and 1.2%, respectively. In contrast, gasoline sales increased 1.5%, due to higher prices, while online sales added 2.2%.

Excluding autos, overall sales in February fell just 0.1% after falling 1.1% in January.

The overall drop follows declines of 0.8% in January from the month before and 0.9% in December from November. On a three-month annualized basis, retail sales are down 4.8%, compared to a 4.3% growth rate six months ago. When February retail sales are compared to the level from a year earlier it was still 1.7% higher.

The overall February figure was well short of what many analysts were expecting with one consensus poll of economists forecasting a 0.3% increase.

“Widespread weakness throughout the categories suggests consumers pulled back markedly in the second month of the year, a reflection of sluggish wage growth and growing concerns surrounding financing today's spending with tomorrow's wages,” said Sterne Agee Chief Economist Lindsey Piegza. “Lower gas prices were a welcome windfall, boosting spending in October and November, but by December consumers have been squirreling away cost savings. Low gas prices alone are not enough to sustain spending patterns, support is needed from organic job and income growth.”

She noted while February weather was unseasonably cold, however, retail sales are seasonally adjusted and weather does not appear to have markedly impacted other economic reports in the same timeframe including regional manufacturing reports as well as the national employment report.

“It is difficult to blame February's spending malaise on weather alone, although it could have played a muted role in the Northeast and Midwest in particular,” Piegza said.

 

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