Winter weather forced shoppers to stay home

March 6, 2026

Retail sales slipped 0.2% in January from December’s downwardly revised level. Compared to a year ago, sales gained 3.2%. Severe winter weather across the Midwest, South and Northeast disrupted daily activities; an arctic air mass set new temperature records across most Southern states. 

Excluding autos, sales came in flat. Consumers retrenched across most discretionary categories after a disappointing holiday season. Motor vehicle dealers lost almost one percent from December. Affordability remains a persistent headache for the auto sector, with high average transaction prices and a growing share of buyers stretching loan terms out to seven years just to make monthly payments.

The one clear bright spot was e-commerce. Nonstore retailers added 1.9% compared to December, extending a run as the dominant growth engine for retail. Online shopping boomed when many were cooped up indoors due to weather. Sales surged almost 11 percent compared to a year ago.   

Department stores experienced the brunt of the post-holiday correction and bad weather, falling 6.0% from December; that’s the third monthly decline in a row. Big-box stores and warehouse clubs fared better, rising 0.2%.  

Apparel stores lost 1.7%, sporting goods and hobby stores declined 1.2% while furniture stores lost 0.7%. Health and personal care slipped 3.0%, although pharmacies eked out a 0.4% gain in the month. The COVID and flu season has been especially nasty this year. 

Gasoline station sales fell 2.9% in January, dragged down by lower pump prices. That was a modest tailwind for households in January, freeing up a little more spending power for other categories. That relief is likely to be short-lived. 

Escalating conflict in the Middle East has pushed up oil prices in recent weeks; rising costs are already showing up at the pump. Gasoline station sales will likely show a rebound in the February data. More importantly, higher energy costs will begin to eat into discretionary budgets.

Core retail sales (which exclude autos, gasoline, restaurants and building materials and feed into the GDP consumer spending calculation) rose 0.3% in January. That counts as a mild positive and suggests the consumer is not yet in retreat.