Retail sales surge in March

By Ben Rooney, staff reporter


NEW YORK (CNNMoney.com) -- Retail sales soared in March, the government said Wednesday, in the latest sign of improving consumer confidence.

The Commerce Department said total retail sales jumped 1.6% last month, the largest monthly increase since November, from an upwardly revised 0.5% gain in February.

Economists surveyed by Briefing.com had anticipated that sales would rise 1.2% in the month.

March retail sales surged 7.6% compared to the same month in 2009.

Sales excluding autos and auto parts rose 0.6% last month, also topping forecasts. A consensus of economists had projected sales excluding autos to edge up 0.5% in March.

Sales of motor vehicles and parts posted a strong 6.7% gain, while sales of electronics and appliances fell 1.3%.

"This is another good reading," said Adam York, an economist at Wells Fargo. "But we're not out of the woods yet."

York said March sales benefited from promotions tied to the Easter holiday, which came earlier than usual this year. He said some of those gains may be shifted over to the April report.

"These are decent numbers," he said. "It suggests that the consumer is recovering, but by no means are we looking at a strong economic recovery."

The rebound in retail sales comes as the labor market has shown tentative signs of improvement. The Labor Department said earlier this month that the economy gained more jobs in March than any other month in the last three years.

Sales at many of the nation's retail chains reported strong sales in March due to unusually warm weather, Easter shopping and improved consumer confidence.

Thomson Reuters, which tracks monthly same-store sales for 30 chains including Costco (COST, Fortune 500) and Target (TGT, Fortune 500), said last week that chain stores posted the biggest single monthly sales gain on record in March, extending a run of seven straight monthly increases.

All of this bodes well for the economy, which is driven mainly by consumer spending.

After a prolonged slump, U.S. gross domestic product, the broadest measure of economic activity, turned positive in the second half of 2009. But the subsequent gains in GDP have been driven mostly by reductions in business inventories and government stimulus.

The economy remains vulnerable enough for policymakers at the Federal Reserve to maintain interest rates near historic lows to help boost activity.

The Fed will release its latest report on regional economic activity later Wednesday. Separately, Fed chairman Ben Bernanke will testify before a joint session of Congress on the economic outlook.  To top of page

Frontline troops push for solar energy
The U.S. Marines are testing renewable energy technologies like solar to reduce costs and casualties associated with fossil fuels. Play
25 Best Places to find rich singles
Looking for Mr. or Ms. Moneybags? Hunt down the perfect mate in these wealthy cities, which are brimming with unattached professionals. More
Fun festivals: Twins to mustard to pirates!
You'll see double in Twinsburg, Ohio, and Ketchup lovers should beware in Middleton, WI. Here's some of the best and strangest town festivals. Play
Index Last Change % Change
Dow 18,162.99 121.45 0.67%
Nasdaq 5,106.59 73.84 1.47%
S&P 500 2,123.48 19.28 0.92%
Treasuries 2.14 -0.00 -0.09%
Data as of 12:10am ET
Company Price Change % Change
Bank of America Corp... 16.74 0.24 1.45%
Michael Kors Holding... 45.93 0.00 0.00%
Broadcom Corp 57.16 10.24 21.81%
Apple Inc 132.04 2.42 1.87%
AbbVie Inc 67.38 0.00 0.00%
Data as of May 27
Sponsors

Sections

Walmart settled with comedian Tracy Morgan over a crash that left him seriously injured. A Walmart truck rear-ended a limo bus Morgan was riding in on the New Jersey Turnpike nearly a year ago. More

Workers with college and graduate school degrees saw their wages fall the most last year. The least educated saw a slight bump in pay. More

Apple's new "CarPlay" system, which allows drivers to use iPhones behind the wheel, is raising concerns among auto safety experts. More

Karlos Dansby, a linebacker with the Cleveland Browns, is bringing his winning strategy from the football field into the startup arena. More

Apple's new "CarPlay" system, which allows drivers to use iPhones behind the wheel, is raising concerns among auto safety experts. More