US Retail Sales Surge Ahead of Tariff Impact

US retail sales increased by 1.4% in March, driven by a surge in purchases of electronics and cars, as consumers aimed to beat impending tariffs. However, analysts predict a downturn in sales due to rising costs and lagging consumer confidence. Some retailers are halting shipping as uncertainties loom.

In a bid to outpace the onset of tariffs, US shoppers aggressively boosted their spending on items like cars and gadgets last month, as reported by the Commerce Department. The retail sales in March soared to 1.4%, a rise from the 0.2% in February, despite the downturn of 1.2% in January that was attributed to frigid weather.

Auto dealers experienced a notable 5.3% increase in sales, while electronics and sporting goods saw increments of 0.8% and 2.4%, respectively. Yet, with the looming threat of new tariffs, a future decline in sales is anticipated as costs escalate for companies, leading to an inevitable price hike that may dampen consumer demand.

Analysts have already observed a dip in consumer confidence. The market faces additional uncertainty as several retailers and suppliers stop or pause shipments from China, and cancellations of orders are being considered until the tariff situation is clarified.

(With inputs from agencies.)