February retail sales fell 1.7%, confirming that bad weather and war fears have ended the brief December/January 1.9% surge in consumer spending.

Only gas stations, drug stores, discount warehouse clubs, and non-store retailers showed increased sales from January, said Jim Haughey, Newport Communication's senior economist. The biggest declines were for building materials (-7.5%) and for auto dealers and clothing stores (-3.6%).
"The deep February decline is not expected to continue into the spring, although only modest sales gains are likely in the next few months," Haughey said. "The record snowfall on Presidents' Day in the East virtually canceled what is usually the biggest shopping weekend of the quarter. This will be partially reversed in March. Consumers have become more cautious retail spenders as income growth has slipped to near zero with rising unemployment and the weak dollar has begun to boost import prices."
Total consumer spending continues to rise slowly, but the mix will remain unfavorable for freight volume for several more months. Above normal shares of income are being spent on new homes, new mortgages, gasoline and home utility bills, Haughey said.