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US retail sales fall in February, weather likely a factor
[WASHINGTON] US retail sales unexpectedly fell for a third straight month in February likely as harsh weather kept consumers from automobile showrooms and shopping malls, which could hurt growth prospects for the first quarter.
The Commerce Department said on Thursday retail sales dropped 0.6 per cent after declining 0.8 per cent in January. The decline in sales last month was almost broad-based, suggesting that snowy and cold weather that blanketed the country in the second half of February could have been a factor.
It was the first time since 2012 that sales had dropped for three consecutive months. Economists polled by Reuters had forecast retail sales increasing 0.3 per cent last month.
Retail sales excluding automobiles, gasoline, building materials and food services were unchanged after a 0.1 per cent decline in January.
The so-called core retail sales correspond most closely with the consumer spending component of gross domestic product.
The second straight month of weakness suggests a marked slowdown in consumer spending in the first quarter after the fourth quarter's surge.
Economists had expected core retail sales would rise 0.4 per cent. February's weak reading could see economists lowering their first-quarter GDP growth estimates.
Economic activity early in the year was hurt by a harsh winter and the now-settled labour dispute at the country's West Coast ports, which disrupted the supply chain.
First-quarter growth forecasts currently range between an annualized pace of 1.7 per cent and 2.5 per cent. The economy grew at a 2.2 per cent pace in the fourth quarter.
In February, automobile sales tumbled 2.5 per cent. Sales at clothing stores were flat. Receipts at building material and garden equipment stores fell 2.3 per cent and sales at restaurants and bars slipped 0.6 per cent.
There were also declines in furniture and electronic and appliances sales.
Receipts at online stores, however, rose 2.2 per cent. Sales at sporting goods and hobby shops increased 2.3 per cent.
A recent rise in gasoline prices lifted receipts at service stations, where sales rose 1.5 per cent, the first increase since May. Gasoline prices rose about 9 cents in February.
Prices at the pump had been dropping since July last year in tandem with falling crude oil prices.