WASHINGTON- US retail sales unexpectedly stalled in April as the boost from stimulus checks faded, but an acceleration is likely in the coming months amid record savings and a reopening economy.
The report from the Commerce Department on Friday also showed retail sales in March were much stronger than previously estimated, setting consumer spending on a higher growth path heading into the second quarter. There were also signs that Americans were starting to shift their spending from goods to services like restaurants and bars, with more than a third of the population vaccinated against COVID-19.
“There will be momentum going into the second quarter for economic growth because sales were off the charts in March,” said Chris Rupkey, chief economist at FWDBONDS in New York.
The unchanged reading in retail sales last month followed a 10.7us surge in March, the second-largest increase on record and an upward revision from the previously reported 9.7us increase. Economists polled by Reuters had forecast retail sales would rise 1.0us. Retail sales surged 51.2us on a year-on-year basis.
A 2.9us rise in motor vehicles purchases was offset by declines in spending elsewhere.
Sales at clothing stores tumbled 5.1us. There were also decreases in sales at sporting goods, hobby, musical instrument and book stores. Sales at building material stores slipped 0.4us. Online retail sales fell 0.6us.
But receipts at electronics and appliance stores rose 1.2us. Sales at furniture stores dropped 0.7us. Consumers also increased spending at restaurants and bars, leading to a 3.0us rise in receipts. That followed a 13.5us jump in March. Sales at restaurants and bars are 116.8us higher compared to April 2020.
Vaccinated Americans are patronizing restaurants and bars after being cooped up at home for more than a year.
