New York - U.S. retail sales fell 0.4% in March, the biggest decrease in nine months, amid a slowdown in hiring and higher taxes. Excluding sales of autos, gas and building materials, core sales dropped 0.2% in March, following a 0.3% increase in January.
“The fall off in spending is no surprise,” said NRF chief economist Jack Kleinhenz. “A colder-than-usual winter, an anemic employment picture and delays in tax refunds impacted consumer spending across the board in March. While we remain optimistic that retail sales will grow modestly this year, it seems like the economy is off to a shaky start as we enter the second quarter. Improving housing prices and lower gas prices may help to offset the toll of increased taxes and sequester.”
Seven of 13 major categories tracked by the Commerce Department showed declines in March, led by a 1.2% decrease at general merchandise stores and a 1.6% drop at electronics stores. Spending was up, however, in some segments. Furniture and home furnishing stores’ sales increased 0.9%. At clothing and clothing accessories stores, sales increased 0.1%.
On Thursday, 15 major retailers released same-store sales results for March. Many of the companies said unseasonably cold weather and early Easter cut into spring spending. According to the International Council of Shopping Centers, same-store sales rose 1.6% in March.