Report: Retail Sales Grew at a Steady Pace in March

Retail sales grew at a steady pace in March in part due to wage gains and easing inflation for goods, according to the CNBC/NRF Retail Monitor report, powered by Affinity Solutions, released on Monday by the National Retail Federation (NRF). According to the Retail Monitor report, total retail sales were up 2.72 percent unadjusted year-over-year in March. That compares with increases of 0.4 percent month-over-month and 2.07 percent year-over-year in February.

The Retail Monitor calculation of core retail sales — excluding restaurants in addition to automobiles and gasoline — was up 0.23 percent month-over-month and up 2.92 percent year-over-year in March. That compared with increases of 0.27 percent month-over-month and 2.99 percent year-over-year in February. For the first quarter, total retail sales were up 2.65 percent year-over-year and core sales were up 3.12 percent.

March sales were up in six out of nine retail categories on a yearly basis, led by online sales, sporting goods stores and health and personal care stores, and up in five categories on a monthly basis.

Total Retail's Take: Retailers, analysts and industry leaders are reacting positively to the latest retail sales figures, although all believe it would behoove retailers to remain cautiously optimistic about the economy and keep low prices top of mind.

“As inflation for goods levels off, March’s data demonstrates steady spending by value-focused consumers who continue to benefit from a strong labor market and real wage gains,” said NRF President and CEO Matthew Shay in a statement. “In this highly competitive market, retailers are having to keep prices as low as possible to meet the demand of consumers looking to stretch their family budgets.”

Analysts expect discretionary goods volume to remain challenged through 2024, given shifts in consumer priority toward services, and the impact of inflation, rising interest rates and reduced savings. As a result, "operational conservatism and agility will be key to successfully managing through what's likely to remain a volatile 2024," said David Silverman, senior director at Fitch Ratings, in a statement emailed to Total Retail.