US retail sales lag while consumer spending stays steady
American consumers are slowly becoming more confident in both their own financial conditions and the country's economy, which has recently translated into increased sales for retailers. However, March's sales figures took a bit of a downturn. Despite this, consumer spending levels remain steady, research has found.
According to the latest statistics from the Commerce Department, retail sales declined slightly in March, marking the second time in three months that these figures have fallen, Reuters reports. Overall, sales decreased 0.4 percent during the month. Analysts say this drop could be the result of increase payroll tax increases that went into effect at the beginning of the year, as many consumers now have less take home pay than in previous months.
On the other hand, Deloitte's Consumer Spending Index revealed that consumer spending has remained solid over the past few weeks. Levels did fall slightly last month, from February's reading of 4.37 down to 4.12 for March, which helps explain the decreased retail sales. However, analysts say the decrease isn't bad news and levels should remain strong in the coming months.
"Consumers have maintained their level of spending in recent months and retailers should be encouraged by the economic signals," said Alison Paul, vice chairman of Deloitte LLP and retail & distribution sector leader.
