Retail Sales Continue Surprise Slide
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Brutal cold weather and heavy snowfall across much of the country in February hurt retail sales even more than expected, with sales dropping 0.6% according to a Commerce Department report released today. It was the third consecutive month of declines—a dubious feat last achieved in February 2012—and they hit nearly every product category while surprising economists who had predicted a 0.3% uptick in pre-release surveys. Even harsh weather and stalled activity in West Coast ports doesn't fully explain the dip, which has some analysts wondering whether the Fed may be forced to rethink its widely anticipated June interest rate hike.
Car sales tumbled 2.5% and restaurant/bar sales slipped 0.6%; both of those losses were the biggest for those sectors in a year. Clothing stores recorded flat results while building and gardening material store sales slid 2.3%, the biggest decline since May 2012. In all, money saved at the gas pump still hasn't translated to more retail spending, although economists say that might change now that weather, at long last, is warming up on the East Coast and Midwest. [Reuters]