By Geoffrey Smith
Investing.com -- U.S. retail sales fell by 0.4% in February, the latest sign that a year of punishing price increases and the depletion of pandemic-era savings is taking a toll on the U.S. consumer.
The fall only partially unwound a surprisingly strong 3.2% rise in January (upgraded from 3.0%) but corroborated multiple reports from consumer-facing sectors in recent weeks that households are starting to revolt against higher prices. It also indicates that the rising trend of layoffs around the country is starting to affect spending levels, even though unemployment remains historically low.
Core retail sales, which strip out auto sales, fell 0.1% on the month, in line with expectations, while sales excluding gasoline were flat. The U.S. doesn't adjust its sales figures for inflation, which was running at 6% year-on-year in February. The monthly rise of 0.4% in the consumer price index means that sales volumes fell more sharply in absolute terms last month than the headline retail sales figure suggests.