Poor Retail Sales Counters Optimism on Banks
Retail sales show recession far from bottom
Tue Apr 14, 2009 1:42pm EDT
By Lucia Mutikani
WASHINGTON (Reuters) Sales at U.S. retailers unexpectedly fell 1.1 percent in March after rising for two straight months, government data showed on Tuesday, dimming hopes the 16-month-old recession was close to hitting bottom.
A separate report showed prices received by U.S. producers fell a surprising 1.2 percent last month, underscoring the economy’s weakness and lack of pricing power.
Despite the weak March sales data, economists said consumer spending likely rebounded in the first quarter, which could mean gross domestic product fell less steeply than the 6.3 percent annual rate recorded in the last three months of 2008.
Federal Reserve Chairman Ben Bernanke, meanwhile, said figures released in the last few weeks on housing and consumer spending suggest signs of improvement.
“Recently we have seen tentative signs that the sharp decline in economic activity may be slowing. A leveling out of economic activity is the first step toward recovery,” Bernanke said in remarks prepared for delivery later on Tuesday.