Warmer weather and an earlier Easter triggered a spending spree in March, according to recent data, as more-confident consumers stocked up on Easter candy and started their spring and summer landscaping projects earlier.
Americans spent about $74 a day on average in March, up sharply from $63 in February and 16 percent above levels seen a year ago, according to a Gallup report released Friday. Drilling down further, upper-income Americans coughed up even more cash, pushing the group's spending to its highest level since Gallup began tracking the data in 2008. While slightly more subdued, lower- and middle-income Americans' spending also ticked up.
"Gallup tracks the more usual types of spending, not like buying a car," says Chris Christopher, economist at IHS Global Insight, crediting an extra-early Easter for some of the uptick in spending. "Given that Easter falls on April 8th, the run-up to Easter really fell in March."
Thanks to the warmer weather, consumers also spent more on building and gardening supplies, and ate out more Christopher says.
Although many of the factors economists credit for the increase in spending are temporary, Christopher says consumer spending should remain fairly strong, at least better than it was a few years ago.
"The levels should be relatively good overall," Christopher says. "The weather factor doesn't really matter [going forward]. If you went to a restaurant a little more than usual in March because of warmer weather that doesn't mean you're not going to go to the restaurant also in April."
Also, while higher gas prices are responsible for some of the increase seen in consumer spending, it tends to take awhile for the impact of higher fuel costs to show up in consumer spending adjustments. As a result, higher consumer spending now due to gas prices could have the reverse effect later down the road if prices remain elevated.
Whatever the reasons, it seems consumer spending has pulled out of the doldrums of the past three years, according to the Gallup report, which is good news for retailers and the job creation increased spending could trigger.
"The overall industry is gaining traction," Christopher said. "There are positive signs that many retailers are doing well."