US retail sales rebounded in April after sluggish winter

American flag hangs on the front of the New York Stock Exchange on an evening in New York. Stocks are opening lower on Wall Street Friday

Retail sales improved in April, suggesting stronger USA consumer spending this spring that should bolster broader economic growth.

Retail sales in the USA increased by less than expected in the month of April, according to a report released by the Commerce Department on Friday. Economists surveyed by The Wall Street Journal had expected a 0.5% gain. On a year-on-year basis, sales rose 4.5% in April.

Commerce reported a 0.4 percent increase from March to April at $474.9 million and a 4.5 percent gain over April 2016.

The NRF added that on a three-month moving average, retail sales have grown 2.6 percent annually. Compared with a year ago, vehicle sales were up 4.4 percent.

Retail sales represent somewhere around two-thirds of all economic activity, and that U.S. retail sales contribute around 14 percent, or $2.6 trillion to U.S. GDP.

Friday's report excluded consumer spending on most services, including medical care and housing.

But many forecasters predicted household spending would bounce back this spring, based on underlying health in the economy.

Consumer confidence has soared since the presidential election, but spending hasn't increased as much as the jump in optimism would suggest. Looking at the overall economy, the USA central bank said it "views the slowing in growth during the first quarter as likely to be transitory". Year-over-year core sales increased 4.5%.

U.S. retail sales in April rebounded from two sluggish months - but clothing was one of just a few categories not to see any pickup in spending as shoppers continued to stay away from malls and online competition intensified. But the optimism is quelled to a degree, he noted, in that while consumers appear to have the resources to spend more than in the past, there is likely to be some hesitancy until there is more clarity in regards to policy changes regarding taxes, trade, and other issues.

Department stores, a sub-category of general merchandise stores, continued to lose the most ground of any subcategory, as April sales dipped 3.7% from April a year ago, but sales were up 0.2% from the month before.

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