Retail Sales

Retail sales fell 0.6% in February, after rising 0.4% in January. Auto sales accounted for most of the drop, as retail sales excluding automobiles fell only 0.2%. Both numbers were below estimates. Economists forecast a flat month for sales, and a slight gain of 0.1% excluding autos.

Rising energy prices, a housing slump, and the credit crunch have, as the report suggests, weakened consumer spending and confidence. It is becoming increasingly possible, depending on the March retail sales number, that real consumer spending will fall for a full quarter for the first time in 17 years.

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