Updated: US February Retail Sales 0.2% vs 0.6% Forecast (MoM)

Comment:

Retail sales in the U.S. rose less than expected in February, and data for the previous month was revised downward, raising concerns about a decline in consumer spending.

The value of retail purchases, unadjusted for inflation, increased by 0.2% after a revised decline of 1.2% in January, according to data from the Department of Commerce released on Monday. Excluding automobiles, sales rose by 0.3%.

The retail trade report primarily covers spending on goods, which is especially important at the moment as President Donald Trump imposes tariffs on a range of imported goods from major trading partners, which is likely to lead to higher prices. This will affect not only low-income consumers, who are already facing financial difficulties, but also wealthier Americans, as the recent drop in the stock market discourages large investments.

Seven out of the 13 categories in the report showed declines, with motor vehicles being particularly notable as they were expected to recover after a weak January. Sales of gasoline, as well as those of electronics and clothing, were also lower. Spending at restaurants and bars, the only service sector category in the report, dropped the most in the past year.

Stock futures reduced their losses, and the yield on government bonds rose following the report.

Retail Sales (MoM) (Feb)
Actual: 0.2%
Forecast: 0.6%
Previous: -0.9%

Core Retail Sales (MoM) (Feb)
Actual: 0.3%
Forecast: 0.3%
Previous: -0.4%