U.S. retail sales declined last month, as Americans cut back their spending on clothes, appliances, and home and garden supplies.
Sales dropped 0.2% in April, the Commerce Department said Wednesday, after a big 1.7% jump in March. Car sales dropped 1.1% last month and sales at electronics and appliance stores dropped 1.3%.
Economists are having a difficult time gauging the mood of consumers this year. Retail sales have been on a seesaw pattern, rising at a healthy pace in January, then falling in February, followed by the big jump in March and now a drop in April. The data suggests Americans are reluctant to spend freely, despite steady job gains and modest wage increases. Retail sales are closely watched because they make up about one-third of consumer spending, which drives most economic activity.
Overall consumer spending, which includes spending on services such as haircuts and travel, jumped in March by the most in nearly a decade, but that followed small increases in the previous two months. As a result, even though the economy grew a healthy 3.2% at an annual rate in the first quarter, consumer spending grew at a modest pace and was not a primary driver of that growth.
The weakness sales last month was widespread. Sales at clothing stores fell 0.2% and plunged 1.9% at home and garden supply stores. Furniture store sales were unchanged. Even the category that includes online retailers dropped. Excluding the volatile auto and gas categories, retail sales also fell 0.2%.
The sales report dragged major U.S. markets down before the opening bell Wednesday.U.S. retail sales unexpectedly fell in April as motor vehicle purchases slumped, government data showed on Wednesday.