February retail sales slip as auto, gas purchases fade
WASHINGTON — U.S. consumers spent less at auto dealers, gas stations and department stores in February, causing overall retail sales to slip 0.1 per cent despite signs elsewhere of a robust economy and the tax cuts signed into law by President Donald Trump starting to take effect.
It was the third consecutive month of declining retail sales, the Commerce Department said Wednesday, though they’re still 4 per cent higher from a year ago. Shoppers have opened 2018 with a cold spell after robust spending gains in the months leading up to the holidays. The core retail sales that economists monitor — which exclude autos, building materials, gasoline and restaurants — improved a mere 0.1 per cent in February after essentially being flat in January.
So far, the promise of higher take-home pay from Trump’s tax cuts appears to have had little influence on spending for big ticket items such as autos. But many economists expect to see gathering momentum for consumer spending given that the unemployment rate is at a low 4.1 per cent and the benefits from the tax cuts start to filter through the broader economy.
“This lull is temporary,” said Gus Faucher, chief economist at PNC Financial Services.