Retail Spending Up; Consumers Still Cautious [AUDIO]
We’re spending more on retail items like cars, clothes and appliances, but we’re still weighing our purchases. The Commerce Department says retail sales increased 1.1 percent last month, the biggest gain since September.
“Most of the strength was in building materials from sales at Home Depot and Lowes and from sporting goods stores like Dick’s,” said Equities Analyst at Nothing But Gold Productions Brian Sozzi. “To me, this shows that weather played a role in what consumers were buying. When you pull back weather, the consumer was not spending as much at places like Wal-Mart or Target or other grocery stores.”
“Five to ten years ago, you would’ve seen them buy the full-priced item at a Dick’s Sporting Goods while also maintaining their spending at other retail stores,” said Sozzi. “Consumers are still making decisions on what they really need and what they want that is weather related. It also depends on if the price is something they can handle.”
Some analysts believe one factor driving the increase was the 3.3 percent hike in gasoline sales last month, the biggest increase in nearly a year which reflected the surge in gas prices. But, excluding gas sales, retail sales were still up 0.8 percent.
Sozzi doesn’t believe gas has played a role in spending at this point. “If we get a big spike in gas prices heading into the summer driving season, if we’re looking at more than four-dollars-a-gallon for regular, we will see quite the swift adjustment,” said Sozzi.