Something doesn’t add up about the American consumer right now. University of Michigan sentiment sat at 53.3 in March, the weakest reading on record. Pump prices rose from $3 to above $4 in the space of three weeks. The Strait of Hormuz closure was knocking roughly 7.5 million barrels a day out of the global oil supply. Consumer expectations were cratering across income brackets.

Then the register rang.

Advance retail sales rose 1.7% to $752.1 billion in March, the U.S. Census Bureau reported Tuesday, blowing past economist expectations of 1.4%. That is the largest monthly gain since January 2023. February was revised up from 0.6% to 0.7%.

The obvious suspect: gasoline stations. Receipts there surged 15.5% on the month, a near-record swing driven almost entirely by pump prices, not volume.

That single line item accounted for roughly two-thirds of the headline beat.

But strip gasoline out, and the story doesn’t collapse.

Retail sales excluding gasoline stations still rose 0.6%, the largest non-gas print since January 2023.

The control group — which excludes autos, gasoline, building materials and food services, and feeds directly into GDP consumer spending — climbed 0.7%, three-and-a-half times the 0.2% consensus.

In simple terms, U.S. consumers keep spending and they are defying the pump shock.

“Americans might be unhappy about the economy and inflation, but they are still spending. Today's retail sales data is consistent with the tight labor market and likely got a boost from tax refunds,” said David Russell, global head of market strategy at TradeStation.

“Higher gas prices are taking a bite, but the damage is limited. While these numbers are good news for the economy overall, they don't necessarily support rate cuts by the Federal Reserve,” he added.

Where The Spending Showed Up In March

The category breakdown paints a consumer willing to spend across a surprisingly broad set of stores, even as sentiment surveys suggested households should be hunkering down.

According to experts, two forces carried the print: tax refunds running roughly $350 higher than the same period in 2025, per Internal Revenue Service data, and a frontloading effect as consumers accelerated purchases ahead of the gas shock.

Market Reactions

Futures on the S&P 500, tracked by the SPDR S&P 500 ETF Trust ( SPY ) , rose 0.29% to 7,130, while the Dow added 0.48% and the Nasdaq 100 climbed 0.39%.

The SPDR S&P Retail ETF was trading higher during Tuesday’s premarket trading, and the fund has already notched six straight sessions of gains – the longest streak since July 2025.

Shares of Amazon.com Inc. ( AMZN ) were 2.5% higher, retesting record highs hit November 2025.

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