Economists and others weigh in on the jump in U.S. retail sales.
The continuing improvement in consumer spending no longer catches us off guard, having observed the improvement despite income stagnation. As the labor market continues to turn, growth in incomes should put a floor under consumption patterns and while consumption is not likely to grow as robustly as the decline might suggest and still remain below the previous peak and trend line, it is growing more than we originally anticipated. This is a fact that cannot be ignored. –Dan Greenhaus, Miller Tabak
The consumer is back. Overall, this was a positive report signaling that consumers are increasing expenditures amid positive stock market wealth effects and the early gains in labor income. The pick-up in consumer spending is crucial for creating positive momentum in the economy and making it a sustained recovery. –Michelle Meyer, Barclays Capital
Every major category was up with the exception of gasoline (-0.4%) and electronics/appliances (-1.3%) — the latter was up a ton the prior two months, so a reversal is not a huge surprise. Among the highlights – general merchandise sales rose 0.6%, apparel rose 2.3%, home improvement up 3.1%, restaurants rose 0.3%, furniture +1.5%. –Jay Feldman, Credit Suisse
There were a number of surprises in the March results which tilted to the downside. In particular, the home electronics category posted a sharp drop on the heels of a couple of very strong months (the intro of the iPad may provide a boost for this category in April). Also, the general merchandise category was not nearly as strong in March as implied by the chain store results. On the other hand, apparel sales were quite a bit better than implied by company results. –David Greenlaw, Morgan Stanley
March results were certainly boosted by the effect of a very early Easter, and April will suffer accordingly, so the two months should be looked at as a package when the April figures are released next month. Still, there is no denying that consumer spending has perked up considerably in recent months. –Joshua Shapiro, MFR Inc.
Consumers spent freely in March. Toyota’s incentive blitz spurred vehicle sales, while much better weather, and an earlier Easter than in 2009, helped weather-sensitive items like clothing and building materials. But there is clearly an underlying pick-up in consumer spending that goes far beyond the weather. –Nigel Gault, IHS Global Insight
Overall recent retail sales reports indicate the U.S. consumer may have emerged from the financial crisis with fewer scars than we had feared. While we are not revising our medium-term consumption forecasts at this time, we would certainly acknowledge that the latest data point to upside risks. –Zach Pandl, Nomura Global Economics
With the upward revision to February and the gain in March, control retail sales are finally back above the previous peak hit in July 2008 — in nominal terms. A passing that underscores that the economy is recovering, but consumers to date are only proving they will buy when necessary, such as for holidays. –Steven Blitz, Majestic Research
What we are seeing in these data is a clear rebound in activity following a quite severe recession. The new inference to be drawn is that the rebound appears to be faster than what was earlier on track, an upside surprise. –Stone & McCarthy
Despite a slump in housing sales in the early part of 2010, retail construction material sales expanded 3.1%, the biggest increase in roughly three years.–Guy LeBas, Janney Montgomery Scott
Additional meaningful and sustained growth in the U.S. labour market and an associated improvement in consumer credit will be necessary for this positive momentum in consumer spending to be sustained. –Millan L. B. Mulraine, TD Securities
Compiled by Phil Izzo