Economic Report: U.S. retail sales fall for third month in a row

Sales at U.S. retailers fell in February for the third month in a row, but the declines were small and unlikely a sign of trouble for the broader economy.

The numbers: Sales at U.S. retailers fell in February for the third month in a row — the first time that’s happened since 2012 — but the declines were small and unlikely a sign of trouble for the broader economy. The monthly decline was 0.1%.

Economists polled by MarketWatch had forecast a 0.4% increase in sales.

Sales rose 0.3% last month if autos and gas are stripped out, however.

What happened: The decline in retail sales last month was largely concentrated in auto dealers, gas stations and traditional department stores, the Commerce Department said Wednesday.

Gas station receipts dropped 1.2%, reflecting in part more stable prices after a runup in January.

Sales at auto dealers fell 0.9% for the second month in a row as a post-hurricane spurt in the fall faded away.

Department stores also recorded a 0.9% decline.

A rather mixed February retail report did contain some bright spots. Internet retailers reaped a 1% gain in sales. Home centers, apparel stores and outlets that sell sporting goods also posted higher sale.

The decline in sales in January wasn’t as large as initially reported, either. Sales were revised to show a 0.1% drop instead of 0.3%.

Big picture: Americans cut back on spending toward the end of the holidays to rebuild their finances, but it’s unlikely they’ll remain tightwads for long.

The economy is growing steadily, unemployment is at a 17-year low, the recent tax cuts are have added to paychecks and annual tax refunds are starting to arrive.

Spending is likely to pick up in the spring. The big question in the industry is whether internet sellers continue to gain market share at the expense of traditional stores.

What they are saying?: “It’s looking like a frosty opening to 2018 for U.S. retailers,” said economist Royce Mendes of CIBC Economics.

Market reaction: The Dow Jones Industrial Average DJIA, -0.68%  and the S&P 500 index SPX, -0.64% were set to open mildly higher in Wednesday trades. The dollar DXY, +0.08%  was little changed and Treasury yields were slightly lower.

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