A hurry to pick up new and used rides ahead of Trump automobile tariffs sent March retail sales to its sharpest gain since January 2023 and is serving to temper consumer slowdown fears. Overall transactions rose a whopping 1.4% month over month (m\/m), a 26-month high, above the 1.3% median estimate and the 0.2% increase in February. The progress was broad-based with the following segments producing the stated m\/m increases:<\/p>\n\n\n\n
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- Car showrooms, 5.3%<\/li>\n\n\n\n
- Building materials suppliers, 3.3%<\/li>\n\n\n\n
- Sporting goods destinations, 2.4% <\/li>\n\n\n\n
- Restaurants\/drinking parlors, 1.8%<\/li>\n\n\n\n
- Electronics destinations, and 0.8% m\/m gains<\/li>\n<\/ul>\n\n\n\n
Gains for personal care stores, miscellaneous retailers, general merchandise establishments, apparel shops, food\/beverage markets and ecommerce ranged from 0.7% and 0.1%.<\/p>\n\n\n\n
Furniture showrooms and gasoline stations weighed on the headline, however, slipping 0.7% and 2.5%. The control group, meanwhile, which contributes heavily to the government\u2019s consumption calculation related to gross domestic product (GDP), grew 0.4% m\/m, lighter than the 0.6% projection and 1.3% from February.<\/p>\n\n\n\n
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<\/figure>\n\n\n\nWarm Weather Dings Industrial Activity<\/strong><\/h3>\n\n\n\n
A warmer-than-expected March dented industrial production as the utilities industry offset progress in manufacturing and mining. The headline result slipped 0.3% m\/m, beneath the 0.2% drop projected and February\u2019s 0.8% advance. The 5.8% decline in utilities countered the 0.6% and 0.3% increase in manufacturing and mining. From a final product perspective, consumer goods and materials sank 1% and 0.5% while business equipment, nonindustrial supplies and construction inputs rose 1.7%, 0.2% and 0.6%.<\/p>\n\n\n\n
<\/figure>\n\n\n\nDour Mood Among Homebuilders Persists<\/strong><\/h3>\n\n\n\n
Homebuilder sentiment is less negative this month relative to March but remains near its recent lows as elevated mortgage rates, pricey properties and waning consumer confidence weigh upon transactions. The NAHB\/Well Fargo Housing Market Index climbed to 40 in April, better than the 37 projected and last month\u2019s 39. Increases in single-family sales and the traffic of prospective buyers helped to cushion a deteriorating outlook for closings over the next six months. Indeed, the present volumes and prospect components advanced from 43 and 24 to 45 and 25, but the future segment declined four points to 43. Regional performance was bifurcated with the Northeast and South dropping from 48 and 39 to 43 and 38, while the Midwest and West areas rose from 38 and 34 to 43 and 35.<\/p>\n\n\n\n
<\/figure>\n\n\n\nUS-China Dispute Pulls Down Equities<\/strong><\/h3>\n\n\n\n
All major domestic equity benchmarks are lower despite split sector breadth with the Nasdaq 100, S&P 500, Russell 2000 and Dow Jones Industrial indices down 2%, 1.2%, 0.5% and 0.5%. The heaviest laggards are the technology, communication services and consumer discretionary segments, which are in the red by 2.5%, 1.5% and 1%. But energy, real estate and materials are gaining the most today, with those areas up 1.9%, 0.6% and 0.2%. Treasurys are getting scooped up across the curve and the 2- and 10-year maturities are changing hands at 3.80% and 4.31%, 5 and 3 basis points (bps) lighter. But softer borrowing costs are weighing on the greenback, which is depreciating relative to all of its major counterparts, including the euro, pound sterling, franc, yen, yuan, loonie and Aussie counterpart. The Dollar Index is plunging 62 bps and is beneath its critical 100 level. Traders are boosting their commodity bets, with gold, silver, crude oil, copper and lumber higher by 3.1%, 1.8%, 1.5%, 1% and 0.2%. WTI crude is trading at $61.71 per barrel even as the EIA reported a third straight week of rising stateside inventories this morning.<\/p>\n\n\n\n
Path to Positive GDP Widens<\/strong><\/h3>\n\n\n\n
This morning\u2019s US economic data on retail sales alongside manufacturing and mining production is incrementally widening the path toward a positive first-quarter GDP report, which our prediction market assigns 78% odds of. But since we don\u2019t have services expenditure numbers for last month yet, there\u2019s a chance that March outlays were driven by goods, which comprise a much smaller share of total consumption than services, at around one-third, while the latter category represents two-thirds of the pie. Still, though, cars are expensive, and the impressive showing points to the potential for a stronger-than-expected consumer in the months ahead. Meanwhile, encouraging developments from the manufacturing and mining sectors in this morning\u2019s industrial production data reflects continued progress in onshoring initiatives and the \u201cdrill baby drill\u201d mantra, two critical goals of Trump 2.0.<\/p>\n\n\n\n
International Roundup<\/strong><\/h2>\n\n\n\n
Bank of Canada Pauses Rate Cuts<\/strong><\/h3>\n\n\n\n
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<\/figure>\n\n\n\n![\"Industrial](\"https:\/\/www.interactivebrokers.com\/campus\/wp-content\/uploads\/sites\/2\/2025\/04\/Picture2-7.png\")
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