People carry groceries from a local gas station on February 15, 2021 in Austin, Texas.
Montinique Monroe | Getty Images News | Getty Images
US retail sales fell moderately more than expected in February amid extremely cold weather across the country, but a recovery is likely, as the government pays out another round of money to relieve the pandemic, especially for families in the United States. low and middle income.
Retail sales fell 3.0% seasonally adjusted last month, the Commerce Department said on Tuesday. The January data was revised to show sales recovering by 7.6%, instead of 5.3%, as previously published. Economists polled by Reuters had predicted a 0.5% drop in retail in February.
Cold weather outside the season hit the country in February, with deadly snowstorms hitting Texas and other parts of the southern region. The drop in sales last month also reflected the fading of the $ 600 increase in one-off checks for households, which were part of nearly $ 900 billion in additional tax incentives approved at the end of December, as well as the delay in the returns of taxes.
Excluding automobiles, gasoline, building materials and food services, retail sales fell 3.5% last month, after an upwardly revised rise of 8.7% in January. These so-called basic retail sales correspond more closely to the consumer spending component of gross domestic product. They were forecast to have shot up 6.0% in January.
Still, last month’s drop in top retail sales left most of January’s gain intact, and the decline was probably temporary. President Joe Biden sanctioned his $ 1.9 trillion bailout package last week, which will send additional checks of $ 1,400 to families, as well as extend a $ 300 weekly government-funded unemployment supplement until June 6. September.
The expected rebound in retail sales will also be driven by an acceleration in the pace of vaccinations, which should allow for broader economic re-engagement, even if the rate of decline in new cases of COVID-19 has stabilized. Families also accumulated $ 1.8 trillion in excess savings.
“With many families set to receive another round of direct checks that are more than double what they received in January, we expect spending to receive another shock in just a few months,” said Sam Bullard, senior economist at Wells Fargo Securities in Charlotte. , North Caroline.
“After that, the record amount of ‘surplus’ savings should provide ample support to finance consumption, as the public health situation improves and restrictions on activities are eased.
Goldman Sachs economists on Saturday raised their first-quarter GDP growth estimate to an annualized rate of 6% from a pace of 5.5%, citing the latest stimulus from the Biden government. The economy grew at a rate of 4.1% in the fourth quarter.
Goldman Sachs forecasts growth of 7.0% this year. This would be the fastest growth since 1984 and would follow a 3.5% contraction last year, the worst performance in 74 years.