The U.S. Commerce Department published its report for March retail sales today and the results echo similar gauges that we reported on earlier, indicating that retailers are enjoying a solid spring thus far.
The Commerce reports shows that retail sales rose 1.6 percent last month, representing the biggest gain in four months and well ahead of the 1.3 percent projections in a recent Dow Jones survey of U.S. economists. Accompanying data from the Labor Department had the consumer price index rising by 0.063 percent last month as well.
According to the data, March’s sales increase was driven largely by strong car sales, although a few other retail sectors performed well also. Clothing and apparel stores, for instance, posted sales increases of over 2.3 percent. Removing all car sales and automobile parts, retail growth was still up 0.6 percent for March, right in line with many expectations.
Commerce also adjusted its previously-reported February retail sales data to a revised 0.5 percent increase (previously 0.3 percent), an even more promising rate given the amount of snow that fell across many parts of the northeastern U.S. back in February.
Another important component in evaluating the healthy of the U.S. retail sector is inventories and Commerce reported data on that as well. The rise in March auto sales can largely be attributed to an accumulation of cars the previous month, while overall retail inventories increased 0.5 percent in February and a revised 0.2 percent in January.
Additionally another key gauge in tracking retail success, inventory-to-sales ratio, is down quite a bit from this time last year. This ratio reveals how well companies are matching supply with demand and the lower the number in this measurement, the better. February’s was 1.27, down from 1.46 in February of last year, and the same as January of this year.
Clearly, retailers are enjoying better business this year compared to early 2009 when many were stuck with excess supplies as shopping and demand fell overall as part of the recession. Now, both shelves and warehouses are starting to refill once again, indicating that the U.S. economy truly is rebounding.
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