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U.S. Retail Sales Show Weak February Recovery, Falling Short of Expectations

Retail sales rose 0.2% in February, below forecasts, as consumer caution persists amidst economic uncertainty and tariff concerns.

Shoppers walk through the Fashion Centre at Pentagon City, a shopping mall in Arlington, Virginia, February 2, 2024.
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Overview

  • Retail sales increased by 0.2% in February, recovering from a 1.2% drop in January but falling short of the 0.6% growth forecasted by analysts.
  • Consumer spending remains muted, with declines in categories like dining out, clothing, and gas station sales, while online retail and health stores saw modest gains.
  • The U.S. economy continues to face uncertainty due to President Trump’s tariff policies, mass federal layoffs, and declining consumer sentiment.
  • Economists warn that cautious consumer behavior and concerns over job security could slow economic growth in the coming months.
  • The Federal Reserve is expected to maintain interest rates this week, as inflation remains above its 2% target and economic risks persist.