Wait, is retail really booming?

If you’ve been reading the slew of headlines about everyone worrying about a recession and cutting their spending, you might be confused to hear that retail sales skyrocketed last month.

Today, the Commerce Department reported that retail sales rose 1.4% last month—a huge jump from February’s 0.2% increase, and the biggest monthly climb since January 2023.

Motor vehicles and car parts made up a significant portion of those sales, with spending in that category jumping 5.3% from February to March. Excluding autos, retail sales were only up 0.5%.

Home improvement sales were also on the rise last month, jumping 3.3% month over month. However, shopping at furniture shops, department stores, and gas stations all declined over the same period.

Big bucks spent before big tariffs

Let’s be clear—people weren’t splashing out because they’re feeling good about the economy. They’re rushing to their nearest car dealership out of fear that President Trump’s tariffs are about to raise the price of everything from auto parts to everyday household items.

“It’s hard to feel good about Americans panic buying cars as consumer confidence craters,” explained Chief Economist for Comerica Bank Bill Adams. “Businesses selling cars, appliances, and electronics are likely to see less demand in the next month or two as panic buying ends.”

Reality check: Just last week, the University of Michigan consumer sentiment survey reported its second-lowest reading ever, and Americans’ expectations for inflation were the highest since 1981. Neither are great signs that retail spending’s hot streak will continue.—LB