US retail sales post significant gain in March

The US Commerce Department reported that in March, retail sales had increased by with 1.6 percent, indicating that this was the biggest increase since September 2017. In February, retail sales had dropped 0.2 percent

Economists that were polled by Reuters had forecast that retail sales would accelerate only 0.9 percent in March. The growth in retail sales was 3.6 percent compared to March 2018.

The sales figures for March 2019 are the first positive sign since retail sales plunged in December 2018 when consumer spending and the economy at large seemed headed toward prolonged decline.

Reuters reported that "retail sales last month were probably lifted by tax refunds, even though they have been smaller than in previous years, following the revamping of the U.S. tax code in January 2018."

Growth forecasts for the first quarter were boosted to around a 2.4 percent annualized rate on Wednesday after data showed the U.S. trade deficit narrowed for a second straight month in February.

However, Reuters commented that stronger growth in the first quarter will probably not change the view that the economy will slow this year as the stimulus from a $1.5 trillion tax cut package diminishes and the impact of interest rates hikes over the last few years lingers.