updated 4/13/2006 12:48:21 PM ET 2006-04-13T16:48:21

Shoppers got their groove back in March, sending sales at the nation’s retailers up by 0.6 percent.

Major Market Indices

The rebound, reported by the Commerce Department on Thursday, provided further evidence that the economy snapped out of an end-of-year funk and was chugging along at a decent clip in the recently ended January-to-March quarter.

The increase in March came after shoppers took a breather in February, pulling down merchants’ sales by 0.8 percent, according to revised figures. That drop wasn’t as deep as first reported a month ago — offering another encouraging sign.

The latest snapshot of retail activity was slightly better than the 0.5 percent gain that economists were forecasting. The advance in March was the biggest since a 3 percent jump in sales for January, a month where unusually warm weather lured people into stores.

“Retail sales rebounded with some surprising vigor,” observed Brian Bethune, economist at Global Insight.

In March, auto dealers, furniture stores, building and garden centers, sporting goods, books and music stores, and health and beauty shops were among the merchants posting sales gains. That offset weakness at electronics and appliances stores and a dip in sales at gasoline stations. Sales were flat at clothing stores — where lots of white and beige apparel failed to inspire shoppers — and at grocery stores.

Economists closely watch consumer behavior because their spending accounts for roughly two-thirds of all economic activity.

For the recently ended January-to-March quarter the economy is expected to have grown by a brisk pace of 4.5 percent or better. The government releases first-quarter figures at the end of the month.

The bounce-back in buying in March came even as consumers had to cope with higher interest rates, rising prices for gasoline and a cooling housing market. All three forces can have the effect of making some less inclined to spend. Yet, an improving jobs market can help to blunt those potentially negative forces.

“The big picture for the consumer still looks good,” said Stephen Stanley, chief economist at RBS Greenwich Capital. “The ongoing spike in gasoline prices will probably curtail demand for other goods for a month or two at some point in the spring, but there is still not much evidence that the consumer is on the cusp of slowing down in any meaningful way.”

Excluding sales of automobiles, which can swing widely from month to month, sales by all other merchants rose by a solid 0.4 percent in March. That was an improvement over the 0.3 percent decline for this category in February.

And, removing high-priced gasoline from March’s results, sales at all other retailers went up by 0.7 percent.

With rising energy prices still a concern, the Federal Reserve is expected to boost interest rates again at its next meeting in May to fend off inflation. The Fed has been pushing up rates since June 2004. Its last rate increase, on March 28, left a key interest rate at a five-year high.

Economists believe that economic growth in the current April-to-June quarter will moderate to a pace of 3 percent or a bit higher — which would still be considered healthy.

© 2013 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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