Retail sales rose more than expected in March as Americans shrugged off high gasoline prices and bought a range of goods, suggesting that economic growth in the first quarter did not slow as much as many had feared.
Total retail sales increased 0.8 percent, the Commerce Department said on Monday, after a slightly downwardly revised 1.0 percent rise in February that was previously reported as a 1.1 percent advance.
Last month's gains, which surpassed economists' expectations for only a 0.3 percent rise, could prompt analysts to raise their first-quarter growth forecasts from an annual pace of around 2.5 percent currently.
The economy grew at a 3.0 percent rate in the fourth quarter.
The rise in sales last month was broad-based, even though Americans paid 27 cents more per gallon of gasoline than they did the prior month.
So far, Americans appear to be taking rising gasoline prices in their stride, thanks to a mild winter that has cut heating bills for households.
Motor vehicle sales rose 0.9 percent after increasing 1.3 percent in February. Auto sales have accelerated in recent months, boosted by pent-up demand by households.
A devastating earthquake and tsunami in Japan caused disruptions to auto production last year and left dealers without models that consumers wanted to buy.
Excluding autos, retail sales climbed 0.8 percent last month after advancing 0.9 percent in February.
Elsewhere, gasoline sales receipts increased 1.1 percent after rising 3.6 percent in February. Excluding autos and gasoline, sales advanced 0.7 percent in March, adding to the prior month's 0.5 percent gain.
Details of the report showed some strength, suggesting consumer spending will continue to support growth.
Last month, clothing store receipts rose 0.9 percent, while sales at building materials and garden equipment suppliers jumped 3.0 percent - the largest gain since December.
Unseasonably mild weather has helped to boost sales at clothing retailers as well as purchases of building materials and garden equipment.
So-called core retail sales, which exclude autos, gasoline and building materials, rose 0.5 percent after increasing by the same margin in February.
Core sales correspond most closely with the consumer spending component of the government's gross domestic product report.
Sales at restaurants and bars edged up 0.3 percent, while receipts at sporting goods, hobby, book and music stores rose 0.5 percent. Sales of electronics and appliances increased 1.0 percent - the largest gain since October, while receipts at furniture stores climbed 1.1 percent
(Reporting by Lucia Mutikani; Editing by Andrea Ricci)