Retail sales in the US rose more than forecast in March, showing consumers are weathering the jump in gasoline prices heading into the second quarter.
The 0.8 per cent gain was almost three times as large as projected and followed a 1 percent advance in February, Commerce Department figures showed on Monday in Washington. The median forecast of 81 economists surveyed by Bloomberg News called for a rise of 0.3 per cent. Eleven of 13 categories showed increases.
Americans snapped up Apple Inc. iPads and clothing at chains like Gap Inc. and Target Corp., indicating an improving job market is boosting incomes and giving households enough confidence to sustain spending in the face of higher fuel costs. Better consumer demand raises the odds that the expansion in the world’s largest economy will endure.
“The outlook for spending is positive,” Chris Christopher, an economist at IHS Global Insight in Lexington, Massachusetts, said before the report. “Consumers are adjusting to high gasoline prices. Jobs are a little more available, and people are getting hired.”
Manufacturing in the New York region expanded in April at the slowest pace in five months, a sign the pickup in factory production is moderating, another report today showed.
The Federal Reserve Bank of New York’s general economic index decreased to 6.6 this month, less than the most pessimistic forecast in a Bloomberg survey, from 20.2 in March. Readings greater than zero signal expansion in the so-called Empire State Index, which covers New York, northern New Jersey and southern Connecticut.
Stock-index futures extended earlier gains after the reports. The contract on the Standard & Poor’s 500 Index maturing in June rose 0.4 percent to 1,370.5 at 8:34 a.m. in New York.
Retail sales were projected to rise after a 1.1 percent gain previously reported for February, according to the Bloomberg survey. Economists’ estimates ranged from no change to a gain of 0.9 per cent.
Electronics, clothing and furniture stores were among the categories showing gains last month, the report showed.
Electronics may have gotten a lift from the new iPad and some discounts on the older model, economists said. Apple said it sold more than 3 million iPads during the debut weekend for the latest model of the market-leading tablet computer. The tally is a record for opening weekend iPad sales, Cupertino, California-based Apple said in a March 19 statement.
Store chain data released earlier were in sync with today’s report. Same-store sales for the more than 20 companies tracked
by Swampscott, Massachusetts-based Retail Metrics rose 3.9 per cent last month, beating the average estimate for a 3.3 per cent gain, as many chains offered discounts and shoppers stocked up early on spring gear.
Sales at automobile dealers defied projections of a decrease as purchases rose 0.9 percent last month, today’s report showed. The results are in contrast with industry figures.
Cars and light trucks sold at a 14.3 million annual rate in March, following a 15 million pace the prior month, according to Ward’s Automotive Group. Nonetheless, the March figures capped the strongest quarter in four years.
“The industry and consumers have been very resilient in the face of higher pump prices,” Don Johnson, vice president of US sales at General Motors Co., said on a call with analysts this month. “The steadily improving economy is playing a role and so is pent-up demand and an improved credit market.”