MACRO: US retail sales fall in February as weather weighed

• US retail sales recorded sharpest decline since April of 2020
• The numbers for March and April are expected to surge

After an exceptionally good reading in January, analysts expected a moderate decline in retail sales last month, however, today's reading fell significantly below market expectations. Retail sales in the US fell 3 % MoM in February,  well below market expectations of a 0.5 % drop. Retail sales excluding autos  dropped 2.70 % MoM  last month, much worse than forecasts of a 0.1 % decline. Both readings were affected by unusually cold weather and winter storms in Texas and other southern regions of the country.  

Today's reading showed the largest decline since a record drop in April of 2020. Source: Bloomberg via ZeroHedge
Readings in all categories dropped besides food and beverage which did not change and sales at gasoline stations which rose 3.6 %. Source: www.census.gov

Year-over-year gains in retail sales slowed but still remains high. Source: XTB, Macrobond

However, if we consider the revisions then today's reading does not look nearly as bad as the headlines look. January retail sales were revised higher to 7.6% from 5.3% while sales ex auto and gas were revised higher to 8.5% from 6.1%. Taking into account that another round of stimulus cheques is being distributed among US citizens, weather conditions have improved and many states continue to lift Covid containment measures one should expect that readings in the following months may improve.