Retail Sales Research Brief

Core retail sales up in real terms. Consumers continue to exhibit resiliency, this time in the face of historically high gas prices, which rose 21.1 percent in March after Strait of Hormuz closures. As such, core retail sales, which exclude auto and gasoline purchases, rose 0.6 percent last month, contributing to a 4.2 percent year-over-year improvement in spending. Moderate movement in the core CPI was noted last month, up 0.2 percent, suggesting that elevated fuel costs had yet to pass through to consumer products. Moving forward, however, pressure could emerge. Early this week, Washington announced an extension of the current ceasefire agreement with Iran; however, port blockades remain in place, which may impede negotiations and keep oil prices elevated moving forward. Additionally, U.S. wage growth continued to moderate in March, with average hourly earnings rising just 0.3 percent over the past year when adjusting for inflation.