U.S. retail sales unexpectedly fell in March as households cut back on purchases of automobiles and other items, further evidence that economic growth stumbled in the first quarter.
Other data on Wednesday showed a surprise drop in producer prices last month as rising energy prices were offset by a decline in the cost of services.
The two reports suggested the Federal Reserve will probably not raise interest rates until later this year.
“The data solidifies the well-entrenched narrative of a very weak first quarter for the U.S. economy. For the Federal Reserve … it argues for continued caution,” said Millan Mulraine, deputy chief economist at TD Securities in New York.
The Commerce Department said retail sales declined 0.3 percent last month, confounding economists’ expectations for a 0.1 percent gain. They were unchanged in February.
Retail sales excluding automobiles, gasoline, building materials and food services ticked up 0.1 percent last month after edging up 0.1 percent in February. These so-called core retail sales correspond most closely with the consumer spending component of gross domestic product. Read more