Retail sales in the United States slowed down in March, but still saw a growth compared to the same period last year, according to the National Retail Federation (NRF).
The NRF said that although retail sales had moderated in March after posting strong gains in the first two months of the year, the continued easing of inflation, the overall strength of the job market, and wages are keeping the fundamentals of the consumer economy strong, which should support their ability to spend on household priorities through 2023.
The latest data provides additional insight into U.S container imports, which are expected gradually increase through the first half of the year before a more normal peak shipping season—albeit below pandemic surge volumes.
“March spending reversed the strong pace of core retail sales we saw earlier this year,” NRF Chief Economist Jack Kleinhenz said. “These results reflect both slower economic activity and lower prices because of easing inflation – which means fewer dollars spent even if consumers buy the same number of goods – but there is still a lot of spending in the economy.”
The U.S. Census Bureau reported that overall retail sales in March were down 1% from February but up 2.9% year over year. In contrast, NRF’s calculation of retail sales, which excludes automobile dealers, gasoline stations, and restaurants to focus on core retail, showed that March was down 0.5% from February but up 4.6% year over year.
Despite the slower growth in March, NRF President and CEO Matthew Shay said retailers recognize the pressure on consumers from increased prices in services and experiences, as well as the impact of higher interest rates, and are prioritizing product mix, competitive pricing, and convenience to help consumers stretch their budgets.
Overall, the NRF is forecasting that 2023 retail sales will grow between 4% and 6% over 2022.