(Bloomberg News) Retail sales in the U.S. rose more than forecast in March, showing consumers are weathering the jump in gasoline prices heading into the second quarter.
The 0.8 percent gain was almost three times as large as projected and followed a 1 percent advance in February, Commerce Department figures showed today in Washington. The median forecast of 81 economists surveyed by Bloomberg News called for a rise of 0.3 percent. Eleven of 13 categories showed increases.
Americans snapped up Apple Inc. iPads and clothing at chains like Gap Inc. and Target Corp., indicating an improving job market is boosting incomes and giving households enough confidence to sustain spending in the face of higher fuel costs. Better consumer demand raises the odds that the expansion in the world's largest economy will endure.
"There is no sign that higher fuel prices have damaged consumer sentiment and spending," said Jeremy Lawson, a senior U.S. economist at BNP Paribas in New York. "This is enough to generate solid economic growth. We've seen the job market improve and that's boosting consumption."
Manufacturing in the New York region expanded in April at the slowest pace in five months, a sign the pickup in factory production is moderating, another report today showed.
The Federal Reserve Bank of New York's general economic index decreased to 6.6 this month, less than the most pessimistic forecast in a Bloomberg survey, from 20.2 in March. Readings greater than zero signal expansion inwthe so-called Empire State Index, which covers New York, northern New Jersey and southern Connecticut.
Stock-index futures extended earlier gains after the reports as consumer spending, which accounts for about 70 percent of the economy, was holding up. The contract on the Standard & Poor's 500 Index maturing in June rose 0.6 percent to 1,373 at 8:47 a.m. in New York.
Retail sales were projected to rise after a 1.1 percent gain previously reported for February, according to the Bloomberg survey. Economists' estimates ranged from no change to a gain of 0.9 percent.
Electronics, clothing and furniture stores were among the categories showing gains last month, the report showed.
Electronics may have gotten a lift from the new iPad and some discounts on the older model, economists said. Apple said it sold more than 3 million iPads during the debut weekend for the latest model of the market-leading tablet computer. The tally is a record for opening weekend iPad sales, Cupertino, California- based Apple said in a March 19 statement.