U.S. retail sales fall unexpectedly in March

Retail sales fell unexpectedly in March, delivering a setback to hopes that the economy’s steep slide could be bottoming out. The Commerce Department says retail sales dipped 1.1% in March. It was the biggest decline in three months and a much weaker showing than the 0.3% increase that analysts expected. A big drop in auto sales led the overall slump in demand. Sales also plunged at clothing stores, appliance outlets and furniture stores. Meanwhile, the Labor Department reported that wholesale prices plunged 1.2% in March as the cost of gasoline, other energy products and food fell sharply. Gas prices fell 13.1%, the steepest drop since December, while food costs dipped 0.7%. Excluding volatile food and energy prices, the Producer Price Index was unchanged, below analysts’ forecasts of a 0.1% rise. Federal Reserve Chairman Ben Bernanke says there’s been “tentative signs” that the recession may be easing. But he also warned that any hope for a lasting recovery hinges on the government’s success in stabilizing shaky financial markets and getting credit to flow more freely again.