U.S. retail sales likely suffered a record drop in March as mandatory business closures to control the spread of the novel coronavirus outbreak depressed demand for a range of goods, setting up consumer spending for its worst decline in decades.
FILE PHOTO: Shoppers wearing protective masks walk through the Historic Downtown Farmers Market during the outbreak of the coronavirus disease in Los Angeles, California, U.S., April 5, 2020. REUTERS/Kyle Grillot/File Photo
According to a Reuters survey of economists, retail sales probably plunged 8.0% last month, signalling the biggest decline since the government started tracking the series in 1992. Retail sales fell 0.5% in February. Steep declines are also expected at restaurants and bars, which stopped in-person service and moved to take-out and delivery service. Though some businesses, including restaurants, have shifted to online sales, economists say the volumes are insufficient to close the gap from social distancing measures.
Core retail sales correspond most closely with the consumer spending component of gross domestic product. With March’s anticipated decrease, economists are forecasting consumer spending plunging at an annualized rate of at least 5.0% in the first quarter, which would be the weakest performance since the second quarter of 1980.
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