The Ministry of Commerce slipped after jumping on Tuesday in February, the Ministry of Commerce said on Tuesday, focusing on the impact of stimulus money on consumer spending, which is likely to move forward as the economy recovers.
Government figures show that sales fell in February by 3% as consumers in some parts of the country face declining stimulus and strong winter storms. The downturn was sharper than some economists had expected, but monthly sales were still higher than a year ago when the epidemic began to squeeze the economy. Retail sales fell sharply in March 2020 amid widespread cessation of operations.
January sales increased by 7.6%. A profit that most likely contributed to the stimulus tests deposited late last year. The January increase, revised upwards on Tuesday, benefited a wide range of retailers. Consumers spent more on goods, including furniture sellers’ department stores as well as restaurants, giving a positive signal to the economy affected by the coronavirus outbreak.
The data suggest that consumer spending recovery is likely to be rough, as the retail sector recovers from consumer spending changes and a new round of stimulus payments arrives in American bank accounts. Most of last year’s retail sales were largely unequal, as consumers flocked to large chain stores, grocery stores, and less money in clothing retailers and restaurants. Balancing incentives, vaccinations, and improving unemployment և hot weather is likely to be needed to balance these categories.
“It was obviously going to slow down,” Micky Chadha, retailer of Moody’s Investors Service, said of February sales.
“Moving forward, the new stimulus tests that are coming to an end as we speak will definitely be positive for the retailer in March-April,” he added. “All indications are that vaccines are being distributed throughout the country, the epidemic is under control, and this ability to spend will only contribute to the retail sale of goods.”
Morgan Stanley economists forecast sales of 0.7% in February, based on a large profit for January, and predicted that the new stimulus, which will come in late March – early April, will boost spending in the coming months.
Navy Federal Credit Union corporate economist Robert Frick, who is able to track credit card spending among his members, said “we are now really in the throes of a retail storm” with last month’s stimulus. եթ The package that has yet to come. He said he expected the economy to return this year, but that retail spending “would be very steep” as it increased.
“The most important thing we all look at is when we move from a supportive life to an economy that walks on its own, from people who have jobs and jobs. Frick said. “It is an open question.”
President Biden signed into law last week nearly $ 1.9 trillion in aid, with $ 1,400 in direct payments per person already flowing into low-middle-income American bank accounts.
The law, known as the American Rescue Program, extends $ 300 a week in federal unemployment benefits until Sept. 6 to provide billions of dollars in coronavirus vaccines to schools, states, tribal governments, and small businesses battling the epidemic. during:
“Part of that amount definitely flows into the retail market. “It simply came to our notice then.
The epidemic has seen a major shift in consumer habits in recent weeks as retailers report year-over-year vacation earnings. (Most retailers end their fiscal year in late January to cover their vacation expenses in full.)
Walmart, for example, reported fourth-quarter revenue of a record $ 151 billion, up 7.3% from a year earlier, while Target also reported growth over the same period, including digital sales. Over the past year, consumers have flocked to the chains, both in person and online, increasingly using services such as curb pickup.
But the story was different in Macy’s և Gap, one of the largest mall operators, which saw a drop in sales in the fourth quarter, a sharp drop in annual revenue as many consumers were far from crazy and had less reason to buy new clothes. isolated environment. Gap, which also owns the Old Navy և Banana Republic, cited restrictions on staying at home փակ closing stores as the reason for its collapse.
Gap still has a positive outlook for the latter half of this year. “Once vaccines are released and stimulus testing begins, we are now looking forward to the second half of 2021, reflecting a possible return to a more normalized pre-epidemic level,” said Katrina O’Connell, Gap’s chief financial officer, in response to a call for revenue this month.
In an interview this month, Month of Gen Genet, Macy’s chief executive, said the company was looking for “tips on what to do with wedding dates, what to do with restaurant bookings, what are the signs that communities are starting to open up.” “It would help the company decide how consumers plan to ‘wear opportunities’ this year,” he said.
February retail sales data showed a decline in January, including furniture, electronics և appliances, building materials և clothing. But Frick, of the Navy Federal Credit Union, says the downturn affected by the cold weather needs to be read in context.
“You have to have a factor in the fact that it has been declining exclusively since January,” he said. “It was still $ 33 billion from February last year, which, of course, was the last month before retail spending fell.”