With Americans heading back to the stores after the unusually rough winter, the Commerce Department released a report on Monday showing that U.S. retail sales rose by more than expected in the month of March.
The report showed that retail sales jumped by 1.1 percent in March after climbing by an upwardly revised 0.7 percent in February.
Economists had expected sales to increase by about 0.9 percent compared to the 0.3 percent increase originally reported for the previous month.
Peter Boockvar, managing director at the Lindsey Group, said, "Retail sales in March showed a nice bounce back after the weather influenced previous months."
The stronger than expected retail sales growth was partly due to a notable increase in sales by motor vehicle and parts dealers, which surged up by 3.1 percent in March after climbing by 2.5 percent in February.
Excluding the increase in auto sales, retail sales still rose by 0.7 percent in March compared to economist estimates for an increase of 0.5 percent.
The report also showed a significant rebound in sales by building materials and supplies dealers, which rose by 1.8 percent in March after falling by 0.6 percent in February.
General merchandise stores and non-store retailers also saw strong sales growth, with sales rising by 1.9 percent and 1.7 percent, respectively.
On the other hand, the report said sales at electronic and appliance stores dropped by 1.6 percent. Sales at gas stations also fell by 1.3 percent.
Core retail sales, which exclude autos, gasoline, and building materials, increased by 0.8 percent in March compared to economist estimates for 0.5 percent growth.
"Bottom line, consumers clearly responded to the winter thaw and the sales gains m/o/m were pretty broad based," Boockvar said.
"With the upside to the core portion of the data, Q1 GDP estimates should go up by about .1-.2 but still may print below 2%," he added. "The sustainability of the sales gains, as opposed to just a onetime weather rebound, will now be the focus."
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