March Retail Sales Grew Despite Higher Inflation

Retail sales grew in March even as inflation edged higher, the National Retail Federation said today.

“March retail sales show that consumers have maintained their ability to spend in the face of record-level inflation, supply chain issues and geopolitical unrest,” NRF President and CEO Matthew Shay said. “Consumers are adapting and shopping smarter for themselves and their families. We believe the strength of the consumer can carry the economy through this considerable economic uncertainty if policymakers implement measured policies and do not overreact to current conditions.”

“While prices soared in March and eroded spending power, shoppers remained resilient and sales were healthy,” NRF Chief Economist Jack Kleinhenz said. “Consumers have the willingness to spend and their ability to do so has been supported by rapid hiring, increased wages, larger-than-usual tax refunds and the use of credit. They are largely dealing with the shock of gas prices but will be facing higher interest rates as the Federal Reserve tightens monetary policy in the coming months. The challenge for the Fed is to cool off demand without pushing the economy into a dramatic slowdown.”

The U.S. Census Bureau today said overall retail sales in March were up 0.5 percent seasonally adjusted from February and up 6.9 percent year over year. That compared with increases of 0.8 percent month over month and 18.2 percent year over year in February. Despite occasional month-over-month declines, sales have grown year over year every month since May 2020, according to Census data.

NRF’s calculation of retail sales – which excludes automobile dealers, gasoline stations and restaurants to focus on core retail – showed March was unchanged seasonally adjusted from February but up 4 percent unadjusted year over year. In February, sales were down 0.7 percent month over month but up 13.2 percent year over year.

NRF’s numbers were up 8.6 percent unadjusted year over year on a three-month moving average as of March. That is consistent with NRF’s forecast that 2022 retail sales will increase between 6 percent and 8 percent to total between $4.86 trillion and $4.95 trillion.

March sales were up in all but two categories on both a monthly and yearly basis, with year-over-year gains led by grocery, clothing and furniture stores. Specifics from key sectors include:

• Grocery and beverage stores were up 1 percent month-over-month seasonally adjusted and up 7.9 percent unadjusted year-over-year.
• Clothing and clothing accessory stores were up 2.6 percent month-over-month seasonally adjusted and up 7.5 percent unadjusted year-over-year.
• Furniture and home furnishings stores were up 0.7 percent month-over-month seasonally adjusted and up 4.2 percent unadjusted year-over-year.
• General merchandise stores were up 5.4 percent month-over-month seasonally adjusted and up 3.9 percent unadjusted year-over-year.
• Online and other non-store sales were down 6.4 percent month-over-month seasonally adjusted but up 2.6 percent unadjusted year-over-year.
• Building materials and garden supply stores were up 0.5 percent month-over-month seasonally adjusted and up 1.8 percent unadjusted year-over-year.
• Health and personal care stores were down 0.3 percent month-over-month seasonally adjusted but up 0.9 percent unadjusted year-over-year.
• Sporting goods stores were up 3.3 percent month-over-month seasonally adjusted but down 5.7 percent unadjusted year-over-year.
• Electronics and appliance stores were up 3.3 percent month-over-month seasonally adjusted but down 9.6 percent unadjusted year-over-year.