The Wall Street Journal reports that “a drop in retail sales and an easing of inflation pressures last month shows the U.S. economy might be cooling after a hot start to the year.
“Spending at stores, online and in restaurants fell by a seasonally adjusted 0.4% in February, the Commerce Department said Wednesday. January retail sales were revised up to a 3.2% gain from a previous estimate of up 3%. Retail sales figures aren’t adjusted for inflation.
“Consumers spent less at restaurants, auto dealerships and department stores and more on essentials at grocery stores and pharmacies.”
The Journal goes on: “The data hints that the economy may be starting to cool in the face of higher interest rates. The Federal Reserve has aggressively raised its benchmark rate in the past year to the highest level since 2007, in an effort to combat inflation. What action the Fed takes at a meeting next week, however, is uncertain as the central bank also confronts financial instability and bank failures.”
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