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March Retail Sales Show Surprise 1.1% Drop
Blow to hopes that economy has hit trough
(AP)
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Retail sales fell unexpectedly in March, delivering a setback to hopes that the economy's steep slide could be bottoming out. The Commerce Department cited a 1.1% drop, the biggest decline in 3 months and a much weaker showing than the 0.3% increase that analysts expected. Falling auto sales led the overall slump in demand. Sales also plunged at clothing stores, appliance outlets, and furniture stores.
Meanwhile, wholesale prices dropped sharply last month as the cost of gasoline and other energy plummeted, fresh evidence that inflation appears to pose little threat to the economy. The Labor Department reported that the Producer Price Index, which measures price changes before they reach consumers, fell by 1.2% in March; analysts expected no change. Gas prices plunged 13.1%, the steepest drop since December, while food prices fell 0.7%.
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