Weak US Re­tail Sales Re­in­force Fed’s Rate Cau­tion

The Economic Times - - Sports -

Wash­ing­ton: US re­tail sales un­ex­pect­edly fell in March as house­holds cut back on pur­chases of au­to­mo­biles and other items, fur­ther ev­i­dence that eco­nomic growth stum­bled in the first quar­ter. Other data on Wed­nes­day showed a sur­prise drop in pro­ducer prices last month as ris­ing energy prices were off­set by a de­cline in the cost of ser­vices. The two re­ports sug­gested the Federal Re­serve will prob­a­bly not raise in­ter­est rates un­til later this year.

“The data so­lid­i­fies the well-en­trenched nar­ra­tive of a very weak first quar­ter for the US econ­omy. For the Federal Re­serve ... it ar­gues for con­tin­ued cau­tion,” said Mil­lan Mul­raine, deputy chief econ­o­mist at TD Se­cu­ri­ties in New York. The Com­merce De­part­ment said re­tail sales de­clined 0.3% last month, con­found­ing econ­o­mists’ ex­pec­ta­tions for a 0.1% gain. They were un­changed in Fe­bru­ary. Re­tail sales ex­clud­ing au­to­mo­biles, gaso­line, build­ing ma­te­ri­als and food ser­vices ticked up 0.1% last month af­ter edg­ing up 0.1% in Fe­bru­ary. —Reuters

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