Consumers spent at a slower pace last month amid ongoing economic concerns.
Consumers returned to their spending ways at local retail stores and digital platforms in February following a sharp drop to kick off the new year.
According to the Department of Commerce, U.S. retail sales rose by 0.2 percent last month, up from a downwardly revised 1.2 percent decline in January.
This fell short of the consensus forecast of 0.6 percent.
Receipts at online retailers soared by 2.4 percent, followed by an increase in sales at health and personal care stores (1.7 percent) and food and beverage locations (0.4 percent).
Transactions at food services and drinking establishments dropped sharply by 1.5 percent, and sales at gasoline stations decreased by 1 percent.
The retail sales control group, which excludes non-core sectors such as building materials stores, car dealers, food services, and gasoline stations, surged at a higher-than-expected 1 percent. This is up from the downwardly adjusted 1 percent slide in January.
Market watchers pay attention to this metric because it contributes to calculations of gross domestic product.
Overall, in the 12 months ending February, retail sales inflation slowed to 3.1 percent from 3.9 percent.
Consumers Signaling the Worst
Market analysts initially dismissed the disappointing January numbers, blaming severe winter weather, California wildfires, and a post-holiday hangover for the decline.
Ted Rossman, senior industry analyst at Bankrate, said the February retail sales figures may continue to feed the growing narrative that economic growth prospects are under attack.
“Consumer confidence has taken a big hit in recent weeks, due mostly to concerns about tariffs on top of already elevated prices, and we’re seeing increasing evidence that consumers are pulling back,” Rossman told The Epoch Times.
A wave of recent surveys indicates that consumers have been expressing concerns about the high degree of uncertainty around public policy and other economic factors.
The March University of Michigan Consumer Sentiment Index plummeted to its lowest level since November 2022 and came in far below market estimates. Current economic conditions held steady, but expectations for the future, from labor markets to inflation, rapidly deteriorated.
By Andrew Moran
