by Census data shows modest 0.6% growth excluding autos and gasoline, with furniture improving month to month but still trailing 2025
WASHINGTON — Retail sales rose 1.7% month over month in March, according to the latest U.S. Department of Commerce report. U.S. retail and food services sales for March were $752.1 billion, up 4% from March 2025, the report says.
On the surface, growth looks solid, but month over month, business at gas stations rose 15.5%, driven by higher fuel prices. However, the sharp increase is masking more modest growth in discretionary categories. Excluding more volatile categories like autos and gasoline, the report reveals that retail sales rose a modest 0.6% month over month. Consumers are still spending, but cautiously. The National Retail Federation referred to this as a “gripe but swipe” mentality in a recent blog.
Furniture and home furnishings stores saw a stronger month over month increase of 2.2%, suggesting near-term improvement in demand. Even so, the category continues to trail its prior-year performance. Sales for the first quarter were down 2.8% compared to 2025, suggesting that while demand may be stabilizing in the near term, it has not yet recovered from the slowdown seen over the past year. While the furnishings category ticked up month to month, the overall trend is still negative.
On a year-over-year basis, growth was strongest among non-store (e-commerce) retailers, which rose 10.1%, followed by miscellaneous store retailers at 9.8%, clothing and accessories at 7.2% and electronics and appliance stores at 5.2%, reflecting continued strength in digitally driven categories.
In a recent blog, the NRF highlighted that consumers benefited from higher tax refunds in March, which likely contributed to growth. Data published by the IRS said 2026 tax refunds averaged $3,521 as of late March, up 11.1% from 2025. This increase was due to tax law changes made in 2025.
“Retail sales grew for the sixth consecutive month in March as the first wave of tax refunds offset higher gas prices resulting from the conflict in the Middle East,” NRF President and CEO Matthew Shay said. “Despite record low consumer sentiment and the highest inflation rate in two years, consumers continued to spend on household priorities. As consumers focus on costs, retailers remain laser-focused on keeping prices competitive and affordable.”
Given these headwinds, it will be interesting to see the April retail report from the U.S. Census Bureau, currently scheduled for release on May 14. NRF underscored that after tax refunds tapered off on April 15, “the longevity of the Middle East conflict will be critical” to how retail sales perform in the short term.
