|U.S. retail sales post largest increase in months|
|Written by Eric Tiansay|
|Thursday, 14 March 2013 08:11 AM EDT|
Retail sales grew in February by the most in five months as an improved job market helped offset the impact of rising gas prices and a 2% payroll tax hike.
The 1.1% increase exceeded all projections in a Bloomberg survey and followed a revised 0.2% gain in January, U.S. Department of Commerce figures showed this week, Bloomberg reported. Core retail sales—excluding the more volatile categories of autos, building materials and fuel—rose 0.7%, according to the National Retail Federation (NRF).
"Retail continues to show its importance to the economy," said NRF President and CEO Matthew Shay. "That said, our consumer research consistently shows a cautious shopper that is making tough spending decisions based upon economic uncertainties, lower paychecks and higher prices for things such as gas.
"This is particularly true among those making $50,000 or less a year," Shay added. "While retail sales numbers indicate good momentum for the economy, consumers with less earning power may continue to face ongoing pressure and retail sales will encounter further challenges as sequestration takes full effect in March."
Retailers hired almost 24,000 new employees in February, contributing to a 236,000 rise in payrolls that exceeded the median forecast of economists surveyed, Bloomberg reported. The unemployment rate also dropped to a four-year low of 7.7%.
"Consumers, once again, exceeded economists' expectations and estimates in February," NRF Chief Economist Jack Kleinhenz said. "It may be too early to measure the impact of the payroll tax hike and higher gasoline prices on consumer spending. However, this portends a good, but not great, first quarter for retailers as consumers continue to breathe life into the economy."
Sporting goods, hobby, book and music stores' sales decreased 0.9% seasonally adjusted month-to-month, but increased 0.6% unadjusted year-over-year, NRF said. Clothing and clothing accessories stores' sales dincreased 0.2% seasonally adjusted month-to-month, but increased 0.4% unadjusted year-over-year.