The sharp drop in retail sales come a month after consumers shopped at an unprecedented pace. U.S. Retail sales fell 3% last month following January’s revised increase of 7.6% according to the latest data from the U.S. Commerce Department, released Tuesday; the data significantly missed expectations as economists were forecasting a decline of 0.5%. Core sales, which strip out vehicle sales fell 2.7% last month, following January’s rise of 5.9%. Economists were expecting to see a 0.2% rise.
Looking at the control group, which excludes autos, gas, building materials, and food services, fell 3.5%. Economists were expecting to see a decline of 0.6%.
The latest economic data is having little impact on the gold market even as prices hold well above $1,700 an ounce. April gold futures last traded at $1,730.60 an ounce, relatively unchanged on the day.
Although the data was worse than expected, some economists have said that they are not surprised to see the decline after January’s strong gains.
Despite the decline, annual retails sales are up 6.3%. “This isn’t a great report but if you add in the revisions, it’s not nearly as bad as the headlines look,” said Adam Button, chief currency strategist at Forexlive.com. “Of course you have the terrible February weather and storms to disentangle as well so it’s tough to draw any conclusions about the consumer with this data.
It won’t get any easier in March either with more stimulus checks, more reopening and good weather.” Katherine Judge, senior economist at CIBC, said that they are expecting to see a pickup in activity later in the month. “With the adverse weather in the rearview mirror, the coming months are set to see an acceleration in consumer spending as services continue to re-open and additional fiscal stimulus arrives,” she said.
