In March, US retail sales rose for the ninth consecutive month, in line with expectations. On a monthly basis, retail sales increased by 0.4% M/M, slightly less than expected, but the figures of the previous two months were significantly upwardly adjusted.
The breakdown shows that strength was broad based as only sales of motor vehicles and parts dropped (-1.7% M/M), while the increase was led by furniture (3.6% M/M), gasoline stations (2.6% M/M), building materials (2.2% M/M) and electronics. Core retail sales, excluding autos and gas, were even stronger, rising by 0.6% M/M, which might indicate that consumers are cutting back spending on gasoline and cars as the increase in sales at gasoline stations was only the effect of higher prices. Nevertheless, retail sales remain surprisingly strong in March despite the late timing of Easter, providing further evidence that household spending remained strong in the first quarter of 2011.