U.S. retail and food services sales jumped 1.7% in March 2026 to $752.1 billion, the U.S. Census Bureau reported on April 21. The gain was the largest monthly increase in more than a year and well above the 1.4% that economists had forecast.
The headline number was heavily shaped by a record 15.5% surge in gasoline station receipts, the largest since the government began tracking that category in 1992. Rising fuel prices tied to the ongoing conflict with Iran and disruptions in the Strait of Hormuz pushed retail gas prices up 24.1% during the month, according to the U.S. Energy Information Administration.
Strip away gasoline, and the picture is more modest but still positive. Excluding gas stations, retail sales rose 0.6%. The so-called control group, which removes autos, gas, building materials, and food services and feeds directly into GDP calculations, climbed 0.7%, beating the 0.2% forecast.
Furniture and home furnishings stores posted a strong 2.2% gain, and electronics retailers rose 0.9%. Auto dealership sales increased 0.5%.
However, consumers pulled back on some discretionary spending. Apparel sales were flat, and food services and drinking places barely moved, up just 0.1%. Economists see restaurant spending as an early warning sign of household financial stress. CNN reported that Allianz Trade senior economist Dan North said lower-income households are most exposed because gasoline takes a larger share of their monthly budgets.
For small businesses, the data sends a mixed signal. Overall consumer spending remains resilient, supported in part by tax refunds that are averaging $351 higher this season compared to the same period in 2025, according to IRS data. But economists at the Stanford Institute for Economic Policy Research estimate that war-driven fuel costs have added roughly $857 to average annual gasoline expenses, money that would otherwise flow to restaurants, retailers, and service providers.
Small retailers and restaurants should watch for signs that this trade-off deepens. Consumer sentiment already fell to a record low in April, and economists expect the tax-refund tailwind to fade in the coming weeks.
The February retail sales figure was also revised upward, from 0.6% to 0.7%. The advance GDP estimate for the first quarter is scheduled for release next week, and the next monthly retail sales report covering April is set for May 14, 2026.
