American consumers stayed away from the stores for the third month in a row suggesting that first quarter retail spending will be considerably weaker than last years exceptionally strong close.
Overall retail sales fell 0.1 percent in February after declining an upwardly revised -0.1 percent in January, originally -0.3 percent, reported the Commerce Department on Wednesday. Sales had been forecast to rise 0.3 percent. Retail spending had also dropped 0.1 percent in December.
The 0.1 percent drop each of the last three months contrasts with and is partially explained as a retreat from the very strong 1.17 percent average pace in September, October and November, which had been the most robust three months for retail sales in twelve years.
Excluding automobiles sales rose 0.2 percent in February, half the estimate and January's result was revised up to 0.1 percent from flat. Purchases at car dealers declined 0.9 percent, the second drop in a row.
Retail Sales Ex-Autos
The 'retail sales control group' which is used by the government to calculate gross national product, and omits automobiles and parts, gasoline, building materials and food service, rose 0.1 percent, well under the 0.4 percent forecast and followed January's unchanged result.
Retail sales had increased at a 3.8 percent annualized rate in the fourth quarter, the quickest in more than a year.
Wage increases dropped back to 2.6 percent annually in February after rising 2.8 percent in January. Workers may be waiting to assess the effect on their disposable income of the tax cuts in last years tax reform measure passed by Congress. Most of those reductions did not hit payrolls until the middle of last month.
Seven of the 13 major retail categories tracked by the Commerce Department saw receipts decline. Sales fell at furniture and home furnishing outlets, appliance and electronics stores and food stores.
Chief Market Strategist
WorldWideMarkets Online Trading