“With consumers still sitting on a pile of accumulated savings combined with the expected reopening of the service economy this summer, our forecast looks for a consumer spending boom this year that will rival any in living memory for most Americans,” Tim Quinlan and Shannon Seery, economists at Wells Fargo Securities, said in a note.
Businesses that have been strong throughout the pandemic, including furniture outlets and building material merchants, experienced solid March sales. E-commerce sales also rebounded.
Ray Blanchette, chief executive officer of restaurant chain TGI Friday’s, said comparable sales, a key indicator in the restaurant industry, turned positive in March and April over 2019 figures.
“Stimulus checks helped,” Blanchette said. “There’s a lot of pent-up demand. And when folks get out they want to enjoy themselves. In many cases, it’s the first time they’ve done it in some time.”
While federal stimulus payments provided a temporary spending boost in the month, their impact in the longer term remains to be seen. Reports in the coming months will show whether job growth and overall consumer confidence will be enough to allow for such huge monthly sales gains.
Further, as the economy continues to reopen, consumers may steer their spending away from merchandise and more toward travel and other services, which could lead to more moderate retail sales.
Gas station receipts rose 10.9%, at least in part reflecting higher fuel prices, which averaged $2.88 per gallon at the end of March, compared with $2.72 at the end of February. The retail figures aren’t adjusted for price changes.
Sales at car and motor vehicle parts dealers advanced 15.1% in March, even as automakers faced production constraints due to the global semiconductor shortage.
—With assistance from Jordan Yadoo, Leslie Patton, Reade Pickert and Sophie Caronello.
This article was provided by Bloomberg News.