US retail sales see modest growth in Feb amid economic uncertainty

Overall retail sales in February increased by 0.2 per cent on a seasonally adjusted month-over-month (MoM) basis and rose 3.1 per cent unadjusted year-over-year (YoY), as per the data released by the US Census Bureau. This follows a decline of 1.2 per cent MoM in January and a YoY rise of 3.9 per cent.

“Lower-than-expected consumer spending in the first couple of months of the year likely reflected payback for very strong spending in the fourth quarter and weather-related events since then. Moreover, these results show that households are apprehensive and carefully navigating lingering inflation and turmoil related to changing economic policies,” said National Retail Federation Chief Economist Jack Kleinhenz.

NRF’s measure of core retail sales—excluding automobile dealers, gasoline stations, and restaurants—rose by 0.9 per cent seasonally adjusted MoM but fell by 0.2 per cent unadjusted YoY. This decline is attributed to a high base in February 2024. On a three-month moving average, core retail sales declined by 1.2 per cent YoY.

Despite the current slowdown, core retail sales had demonstrated strong performance in the previous months, growing by 4.2 per cent YoY during the 2024 holiday season and recording a full-year increase of 3.6 per cent.

A separate report from the CNBC/NRF Retail Monitor, powered by Affinity Solutions, showed a slight decrease of 0.22 per cent in seasonally adjusted core retail sales in February compared to January. However, on an unadjusted YoY basis, core retail sales increased by 4.11 per cent. This contrasted with January’s figures, which recorded a 1.27 per cent MoM drop but a strong 5.72 per cent YoY increase.

“Regardless of the softer spending, consumer fundamentals remain healthy and intact so far, supported by low unemployment, steady income growth and other household finances. American shoppers will likely continue to spend as long as unemployment remains low, and job growth continues,” Kleinhenz said in an NRF release.

Fibre2Fashion News Desk (HU)