Preview: Due April 21 - U.S. March Retail Sales - Surge on gasoline prices, underlying trend subdued
We expect March retail sales to surge by 1.4% largely on surging gasoline prices, with sales ex auto and gasoline even stronger at 1.6%. Ex autos and gasoline we expect a rise of only 0.2%, on the weak side of a trend that has recently lost momentum.
Most of the rise in sales will come from a surge in gasoline prices. Industry data suggests a rise in auto sales, we expect by 0.7% after a 1.2% increase in February, but this will not match the ex-auto increase, leaving overall sales underperforming the ex-auto gains.
Resilient auto sales suggest consumers did not immediately cut down on other items in response to higher gasoline prices but should the gasoline price rise persist, downside risks will build in Q2. A 0.2% increase ex autos and gasoline would be in line with what has been a subdued trend over the last six months. Higher tax refunds than seen at this time in 2025 may provide some offset to the hit to real disposable income coming from higher gasoline prices.
Q1 would then see a rise of 0.7% (not annualized) in overall retail sales, up from 0.4% in Q4, while Q1 sales ex autos would pick up to a 1.0% gain from 0.7% in Q4. Ex autos and gasoline however we expect the increase to match Q4’s 0.7%, which was a significant slowing from 1.3% seen in both Q2 and Q3.
