US retail sales unexpectedly drop in March

US retail sales unexpectedly fell in March, according to data from the Commerce Department.

Sales dropped 0.3% on the month compared with expectations of a 0.1% increase, as auto sales slumped 2.1%.

A fall in retail sales at clothing stores and restaurants also contributed to the overall decline.

Excluding auto and gasoline components, sales were up 0.1% compared to forecasts of a 0.3% increase.

“Last year, economists heralded the resilience of US consumers as a rare bright spot against a backdrop of turbulent financial markets and weakening global demand, so they will be discouraged by this below expectations performance,” said Dennis de Jong, managing director at UFX.com.

“These lingering doubts over retail’s strength may force the Fed to give second thought to the rumoured interest rate hike, which some had speculated could come sooner rather than later.”