Catenna, Monday, March 17, 2025- US Consumer spending rose in February despite uncertainty in the economy as retail sales grew at solid space but less than expected.
Headline retail sales rose 0.2% in February, the Commerce Department said on Monday, less than the 0.6% increase economists had expected. Retail sales in January were revised lower to a decline of 1.2% from a prior reading that showed a 0.9% decrease in the month.
The control group, which strips out non-core sectors and feeds directly into gross domestic product calculations, rose a better-than-expected 1%. Economists had expected a 0.4% increase.
However, January’s control group sales number was revised to a 1% decline, lower than the initial 0.8% fall reported. February sales, excluding auto and gas, rose 0.5%, above consensus estimates for a 0.4% increase.
Online spending helped boost the sales number for the month, with nonstore retailers reporting a 2.4% increase. Health and personal care showed a 1.7% gain while food and beverage outlets saw a 0.4% rise.
On the downside, bars and restaurants reported a 1.5% decrease, while gas stations were off 1% amid falling prices at the pump.
Sales overall increased 3.1% on a year-over-year basis, better than the 2.8% inflation rate as measured by the consumer price index
The February report comes amid a shifting narrative surrounding the US economy. January’s retail sales reading marked the worst retail sales report in a year and was one of the first data points that kicked off the market’s rerating of the US economy’s growth outlook over the past month.
As economic forecasts have tumbled in recent weeks amid uncertainty over President Donald Trump’s tariff policy, major stock indexes have sold off. The S&P 500 entered Monday’s trading session off more than 8% from its most recent record close on February 19.
