Retail Sales See Biggest Increase Since March 2025 Amid War-Driven Surge in Gasoline Receipts

12:46 PM EDT, 04/21/2026 (MT Newswires) -- US retail sales last month logged the largest rise since March 2025 amid a surge in spending at gasoline station as the Middle East conflict boosted prices, official data showed Tuesday.

Retail sales rose 1.7% sequentially in March, following a revised 0.7% gain in the month prior and marking the biggest increase since March 2025, the Census Bureau reported. The consensus was for a 1.4% increase in a Bloomberg-compiled poll.

Sales at gas stations jumped roughly 16% last month, while furniture and home furnishing stores saw a 2.2% rise, with most other categories also logging gains, according to government data.

"We expected that the headline (figure) would be gaudy due to the increase in gas prices and a pickup in unit auto sales, but the strength in other categories was surprising," Jefferies Chief US Economist Thomas Simons said in a note to clients. "There is no evidence here that higher gasoline prices have motivated the consumer to tighten the belt elsewhere just yet."

Energy prices have soared following the US-Israel war with Iran that started at the end of February amid the closure of the Strait of Hormuz, the world's most important chokepoint for crude flows.

US retail gasoline prices averaged $4.022 per gallon Tuesday, compared with $3.153 a year ago, according to data from AAA, a travel organization that tracks fuel prices in the country.

It's not clear when US Vice President JD Vance will leave for Pakistan ahead of a potential second round of negotiations with Iran, as the deadline for a previously announced ceasefire looms, CNN reported Tuesday, citing sources. Tehran has yet to confirm attendance in negotiations, the news outlet reported, citing Pakistani mediators.

"Our base case is that the ceasefire will not be extended, but also that the expiration of the ceasefire will force rapid progress towards a durable end to the fighting and a normalization of the flow of goods through the Strait of Hormuz," Simons said. "If this is correct, gas prices will gradually drift lower throughout the remainder of the year, providing some tailwinds to consumer spending and overall economic growth."

Retail sales without the motor vehicle and gas components were up 0.6% in March, topping Wall Street's views for a 0.3% increase, official data showed.

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