Shoppers around the country spent a little more money last month than they did in January, but not by much.
Numbers released by the Commerce Department this week showed retail sales rose just 0.2% in February, a slight bounceback after a sharp 1.2% drop in January. While sales rose at grocery stores, home and garden stores and online retailers, they fell at auto dealers, restaurants and electronics stores.
Some economists were relieved the numbers weren’t worse, according to reporting from The Associated Press. Still, AP reported, many expect consumer spending will grow just 1% to 1.5% at an annual rate in the first three months of this year, far below the 4.2% gain in the final quarter last year.
“Consumer spending is on track to slow sharply this quarter, but not by as much as we previously feared,” Stephen Brown, an economist at Capital Economics, a consulting firm, told the AP in an email.
On Friday, a measure of consumer sentiment fell sharply for the third straight month and is now down more than 20% since December. Respondents to the University of Michigan’s survey cited policy uncertainty as a leading reason for the gloomier outlook, according to the AP.
Consumers from all income levels are feeling more strained, according to a slew of earnings reports over the past few weeks from major retailers including Walmart, Macy’s and Dollar General.
February sales also fell last month at gas stations, clothing stores, and sporting goods stores. The figures aren’t adjusted for prices, and the cost of gas also declined in February, which likely accounts for most of the drop. Excluding gas and autos, retail sales rose 0.5%, a healthier figure but still modest after a plunge of 0.8% in January.
