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Latest News

March 14 — Retail sales jumped 1.0% in February, despite rising gasoline prices, to turn in a strong monthly gain and the eighth consecutive monthly increase, reported the U.S. Commerce Department reported on Friday.

But spiking fuel costs took their toll by mid-March, when The Reuters/University of Michigan Survey of Consumers found sharp erosion in consumer confidence. At mid-month the Index registered 68.2, well down from 77.5 at the end of February. The biggest drop was in the expectations index, which fell more than 13 points to 58.3.

February’s gain in retail sales came on the heels of an upwardly revised 0.7% gain in January, prompting expectations of accelerated economic growth for the first quarter. February sales were 8.9% ahead of last February. Consumers continued to spend despite a 3.7% surge in gasoline prices during the month.

The last two weeks of fuel increases and instability in the Middle East, however, drove consumer expectations down to a five month low, according to the Reuters/University of Michigan survey. Although respondents said their buying plans were largely unaffected, the rate of real consumer spending is likely to go down, Reuters reported. However, “The report does not indicate a renewed downturn on the horizon," said Reuters.

Read the U.S. Commerce Department news release.

Read the Reuters news article.