Retail sales in the U.S. fell by 0.6 percent in February, weighed down by bad weather and continued consumer caution about the economy, the Associated Press reported.
The slight decline was the third monthly drop in a row, and followed a 0.8 percent drop in January, according to a monthly Commerce Department report released Thursday (March 12). Auto sales fell by the most in more than a year, consumers spent less at restaurants and on building materials, and an increase in gasoline prices that resulted in a 1.5 percent rise in gas sales wasn’t enough to offset those declines.
Excluding those relatively volatile categories, sales were flat for the month.
The report’s results weren’t unexpected. Snow and freezing temperatures cut spending in the northeastern U.S. in February — it was down 6.2 percent in Boston, while nationwide spending was up 1.5 percent, according to a report from First Data that used different metrics than the Commerce Department. The Federal Reserve’s “beige book” report also noted that “both the New York and Boston Districts reported that harsh winter weather negatively affected retail business.”
One possible result of customers’ desires to stay home: Sales for non-store retailers, mainly e-commerce merchants, rose 2.2 percent.
But not all of the February decline can be pegged to the weather. Consumers appear to be hesitant about spending the money in their pockets from lower gas prices and improved hiring. Sales fell by 1.2 percent at electronics and appliances stores, the Commerce report said. It also fell by 1.2 percent at department stores and discount retailers, and by 0.6 percent at restaurants.
Meanwhile, the savings rate rose to 5.5 percent in January from 5 percent in December, meaning that Americans saved the most they have at any time in nearly two years, the AP reported. Consumer confidence also rose in January and February to its highest levels since the recession.