Retail sales in the U.S. unexpectedly fell in March as soaring job losses forced consumers to pull back.
The 1.1 percent decrease followed a 0.3 percent gain in February that was stronger than previously estimated, the Commerce Department said today in Washington. Auto dealers, electronics stores and restaurants led the decline.
Less consumer spending heading into the second quarter means the recession is likely to persist. Incentives and promotions by car dealers and clothing stores such as Gap Inc. failed to draw customers hurt by a lack of credit and the highest jobless rate in 25 years.
``With employment declining sharply and credit restricted, households will spend cautiously this spring,'' Nigel Gault, chief U.S. economist at IHS Global Insight in Lexington, Massachusetts, said before the report. ``We expect that a slight rise in real consumer spending in the first quarter will be followed by a slight decline in the second quarter.''
Retail sales were projected to rise 0.3 percent in March after an originally reported 0.1 percent decline the prior month, according to the median estimate of 73 economists in a Bloomberg News survey. Forecasts ranged from a decline of 0.2 percent to a gain of 1.2 percent.
Excluding automobiles, sales decreased 0.9 percent after a 1 percent gain in February. They were forecast to show no change, according to the survey median.
http://www.bloomberg.com/apps/news?pid=20601087&sid=anP.K55X8d_s&refer=home
The 1.1 percent decrease followed a 0.3 percent gain in February that was stronger than previously estimated, the Commerce Department said today in Washington. Auto dealers, electronics stores and restaurants led the decline.
Less consumer spending heading into the second quarter means the recession is likely to persist. Incentives and promotions by car dealers and clothing stores such as Gap Inc. failed to draw customers hurt by a lack of credit and the highest jobless rate in 25 years.
``With employment declining sharply and credit restricted, households will spend cautiously this spring,'' Nigel Gault, chief U.S. economist at IHS Global Insight in Lexington, Massachusetts, said before the report. ``We expect that a slight rise in real consumer spending in the first quarter will be followed by a slight decline in the second quarter.''
Retail sales were projected to rise 0.3 percent in March after an originally reported 0.1 percent decline the prior month, according to the median estimate of 73 economists in a Bloomberg News survey. Forecasts ranged from a decline of 0.2 percent to a gain of 1.2 percent.
Excluding automobiles, sales decreased 0.9 percent after a 1 percent gain in February. They were forecast to show no change, according to the survey median.
http://www.bloomberg.com/apps/news?pid=20601087&sid=anP.K55X8d_s&refer=home