Newsroom

Total retail sales rose by 0.5 percent in March, following an increase of 0.8 percent in February and an increase of 5.1 percent in January. NAFCU Chief Economist and Vice President of Research Curt Long analyzed the report in a new NAFCU Macro Data Flash report.

"Retail sales slowed again but stayed positive in March on a seasonally-adjusted basis," stated Long. “Gains were highly concentrated in gas stations, which increased 8.9 percent, and areas that benefitted from declining COVID cases, such as electronics and appliance stores, department stores, and restaurants."

Sectoral performances were mixed in March, the biggest winners being gasoline stations (+8.9 percent) and general merchandise stores (+5.4 percent), followed by electronics and appliance stores and sporting goods stores, which both rose by 3.3 percent. Losses hit several sectors during the month, with sales at nonstore retailers falling by 6.4 percent, followed by motor vehicle and parts dealers (-1.9 percent), and health and personal care stores (-0.3 percent).

"Excluding gas sales, retail sales fell by 0.3 percentage points on the month," added Long. "That is reflective of a slowing economy in general, but also the rotation away from goods and into services. Retail sales data primarily captures goods consumption."

Year-over-year growth in retail sales were up 6.8 percent during the month, which is down from 13.8 percent in February. Control group sales – which excludes auto, gas, and building material categories – were up 6.7 percent from a year ago.

“The Fed will hike aggressively through the summer to try to rein in inflation,” concluded Long. “But if consumer spending slows materially, there will be a strong push by the dovish faction of the FOMC to moderate the pace of rate hikes in the second half of the year.”

For more up-to-date economic updates from NAFCU's award-winning research team, view NAFCU's Macro Data Flash reports.