Question: Do increases in gas prices lead us to cut back on how much gasoline we put into our cars and trucks?
A. Yes, and home kits that transform bacon grease into diesel fuel fly off the shelves.
B. Not so much.
The bottom line from today’s report on retail sales is that consumer spending continues to increase, even after a surge in spending late last year. February retail sales increased 1.0 percent and the increases in retail sales in the previous two months were revised upward. Taken together, the January-February average of retail sales rose 7.7 percent at an annual rate over the fourth quarter. Why are consumers spending more? There are a couple of reasons, with the two most important likely being an improving job market (remember that payroll employment went up 192,000 in February and there was an upward revision of 58,000 to the previous two months) and the two-percentage-poin
February 2011 retail and food services sales were $387.1 billion, up 1.0% from January and an increase of 8.9% from February 2010. Excluding autos, retail and food services sales in February were $315.7 billion, up 0.7% from January and up 6.0% from one year ago.
The bottom line is that consumer spending gathered steam late last year, and according to today’s Retail Sales data release, consumer spending is on track to post a moderately strong gain in Q1, a trend consistent with other indicators of consumer spending. [1]
Retail and food services sales in January 2011 rose 0.3 percent from the prior month and 7.8 percent from the prior year, to $381.6 billion. Excluding automobiles, retail sales in January 2011 rose 0.3 percent from December and increased 6.2 percent from January 2010, to $312.7 billion.
