Retailers saw a second successive rise in sales in February. A 1.1 percent monthly bounce matched the upwardly revised January gain and means that volumes have now risen in three of the last four months. The latest advance puts purchases at their highest level since last September and 5.1 percent above their mark just before the arrival of Covid. Annual growth was 0.3 percent, up from minus 0.7 percent.

February's monthly gain was almost wholly attributable to the non-food sector where, excluding auto fuel, sales jumped fully 3.1 percent on the month. Food demand dipped 0.1 percent but auto fuel was up 0.8 percent.

Today's update leaves average overall volume sales in January/February 0.5 percent above their mean level in the fourth quarter and so on course to provide a boost to GDP growth. Absent any revisions, March will need to see a monthly fall of at least 2.2 percent for a negative contribution.

Retail sales measure the total receipts at stores that sell durable and nondurable goods. The survey comprises around 4,000 companies with the small-sized firms asked to provide monthly turnover data on a quarterly basis. Statistics are provided in both nominal and volume measures; the latter is the more important for financial markets. The headline figure is the annual growth in sales volumes adjusted for differences in trading days. Seasonally adjusted monthly changes are also provided. Details are limited in the first estimate but a more complete picture is provided with the following month's release.

Consumer spending accounts for a large portion of the economy, so if you know what consumers are up to, you will have a pretty good idea on where the economy is headed. Needless to say, that is a big advantage for investors. The pattern in consumer spending is often the foremost influence on stock and bond markets. For stocks, strong economic growth translates to healthy corporate profits and higher stock prices. For bonds, the focus is whether economic growth goes overboard and leads to inflation. Ideally, the economy walks that fine line between strong growth and excessive (inflationary) growth. Retail sales not only give you a sense of the big picture, but also the trends among different types of retailers. Perhaps auto sales are especially strong or apparel sales are showing exceptional weakness. These trends from the retail sales data can help you spot specific investment opportunities, without having to wait for a company's quarterly or annual report.