Higher gas prices lift retail sales

NEW YORK (CNNMoney) -- Consumers were spending more in February, but a big part of the rise was caused by rising gas prices.

Overall retail spending rose 1.1% in February compared to the month before, according to Tuesday's Commerce Department report. But spending at gas stations jumped 3.3% in the month, as gas prices rose almost continually throughout the period.

Stripping out spending on gasoline prices, retail spending posted only a 0.8% rise in the period.

There were other signs of strength in the spending report.

Spending at auto dealers rose by 1.9%, as automakers reported the best month for auto sales in four years.

And spending at building supply retailers posted an 1.4% rise, as unusually warm February weather, low mortgage rates and a tight supply of new homes for sale all helped to give home building a strong start to 2012 after years of weak housing starts.

Stripping out gasoline, auto sales and spending at home improvement stores, the figure that many economists consider to be a core retail sales figure rose a far more modest 0.5% in the month.

Paul Dales, senior U.S. economist for Capital Economics, said that the underlying sales gain is decent and a bit better than expected. He pointed out the underlying sales were also revised higher in January.

Overall spending for both December and January were revised higher in the latest report.

Joseph LaVorgna, chief U.S. economist for Deutsche Bank, said the report was a solid one for consumer demand, even when stripping out spending at gas stations, car dealers and building supply stores.

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He pointed out that most categories posted some kind of gain, including a 1% rise in spending on electronics and appliances, a 1.5% increase in spending at department stores and a 1.8% rise in spending on clothing. Spending at nonstore retailers, primarily stand-alone online shopping sites, rose 1%.

"It is possible that mild winter weather gave an early lift to some seasonal categories," LaVorgna wrote in a note to clients Tuesday. "However, an additional -- and likely more important -- factor is the strength in household income growth due to job creation and earnings growth."