Newspaper article THE JOURNAL RECORD

...Retail Sales Up 0.4 Percent, Indicating Modest Growth

Newspaper article THE JOURNAL RECORD

...Retail Sales Up 0.4 Percent, Indicating Modest Growth

Article excerpt

WASHINGTON (AP) _ Consumers increased spending in March, and analysts said the resulting 0.4 percent rise in retail sales suggested the economy would continue to grow modestly.

Sales totaled a seasonally adjusted $182.3 billion, up from $181.5 billion in February, the Commerce Department reported Wednesday.

"It confirms the fact that after all the wild gyrations, most related to the weather and the California earthquake, we're seeing the real trend _ that is, moderate growth," said economist Sandra Shaber of the WEFA Group in Bala Cynwyd, Pa.

"It shows that consumers continue to spend, that they are not weighted down by debt, that they are not agonizing over the state of the economy," she added. "They are spending, but it's not a booming economy."

Bruce Steinberg, an economist with Merrill Lynch Co., said the report suggested consumer spending should grow at an annual inflation-adjusted rate of between 3 percent and 3.5 percent in the first quarter.

Consumer spending, two-thirds of the nation's economic activity, expanded at a 4.4 percent rate in the final three months of 1993. Retail sales represent about half of consumer spending.

Commerce Secretary Ronald H. Brown said the report suggests "consumer spending is growing at a sustainable pace consistent with the balanced recovery now under way."

Because of the harsh weather and the earthquake, January retail sales fell 1.3 percent for the first time in 10 months before rebounding 1.6 percent a month later. And many analysts had expected sales to continue to expand by 1 percent or more in March.

Shaber offered two reasons why the larger sales increase was not realized.

"One, we all expected stronger sales in the auto sector," she said. "The other thing is, while people were looking at chain store sales and seeing big gains, they were forgetting that last year at this time, we had the storm of the century. …

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