-Ian Shepherdson, chief economist at Pantheon Macroeconomics Ltd
US retail sales unexpectedly declined for a third month in a row in February as harsh weather and tepid wage growth restrained shoppers. The Commerce Department said sales at US retailers fell by a seasonally adjusted 0.6% last month, against analysts' expectations for a 0.3% gain, and following the 0.8% drop in January. It was the first time since 2012 that sales had declined for three straight months. Core retail sales, which strip out automobiles and correspond most closely with the consumer spending component of gross domestic product, declined 0.1%.
Meanwhile, the number of initial jobless claims declined last week to a seasonally adjusted 289,000, the Labor Department reported. The preceding week's level was revised upwards to 325,000 claims, from an initially reported 320,000. Claims for the week ended February 28 week were the highest since May 2014. Yet, the four-week moving average for claims, which evens out week-to-week volatility, fell by 3,750 to 302,250 last week. Yet, the US labour market remains a bright spot in the Fed's assessment of the world's number one economy, particularly after the non-farm payrolls report revealed hiring in the US overshot expectations and remained above 200,000 for the 13th consecutive month, with 295,000 people added to the workforce in February. Consequently, the unemployment rate slid to 5.5%.
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