Retail sales posted their largest monthly gain in a year, as consumers stepped up to buy automobiles, furniture and other goods. Bobbi Rebell reports.
Retail sales finally turned a corner in March rising for the first time since November. It was the biggest monthly gain in a year. Overall sales were up nine-tenths of a percent. The core rate, which takes out volatile categories like autos and gas, was up half a percent. But Craig Johnson, who heads retail consulting firm Customer Growth Partners, isn't buying into the celebration: SOUNDBITE: CRAIG JOHNSON, PRESIDENT, CUSTOMER GROWTH PARTNERS (ENGLISH) SAYING: "When you x out the fact that we, you know, are this far into recovery, gasoline prices are 33% below last year. We have pent-up demand from a very cold January, February, and an early Easter. We should be having five or six percent year-over-year growth. We have barely one percent year-over-year growth after taking out gasoline and autos. " And, in fact, the results were slightly below forecasts. The reality is that there have been a lot of headwinds. An unusually snowy winter cut into spending early this year. And, while the job market has improved, workers are still not seeing much more in their paychecks. And the money saved on gas has not been going to retailers as many had expected: SOUNDBITE: CRAIG JOHNSON, PRESIDENT, CUSTOMER GROWTH PARTNERS (ENGLISH) SAYING: "Restaurants and fast food places are up seven or eight percent year over year. A lot of the money is used to buy more gasoline. You drive more, so people are driving ten or 12 percent more each month. And, then some goes to general merchandise, whether it's at the home improvement, a couple other categories, home furnishings are up, or food, because there is food inflation, about three percent a year. So, it goes to that, and then a little bit may be going to savings." In fact, savings are at their highest levels in just over two years, money on the sidelines that could at some point find its way to retailers.