U.S. retail sales slid for the second consecutive month in March, falling 0.2 percent. This was greater than the 0.1 percent analysts had expected, and significantly off the 5 percent increase in March 2016, according to U.S. Commerce Department data.

Retail sales for February were revised down to a 0.3 percent decrease from the 0.1 percent decrease originally reported in the first decline in the past year. Analysts are attributing part of the decline to delayed tax refunds as the government gives filings extra scrutiny to combat fraud.

Sales of automobiles slid 1.2 percent in March in the third consecutive month of declines. Meanwhile, sales at service stations were 1 percent lower amid lower gas prices. Sales at building materials stores also fell, down 1.5 percent, as many building projects were put on hold for weather-related reasons. (See also: Retailers Need to Step Up Closings.)

“As with last year, we expect the first quarter (and especially March) weakness in auto sales to be short-lived as the job market expands. Moreover, gasoline prices have risen again in April,” David Berson, chief economist at Nationwide, said in a note, according to Bloomberg. “Consequently, we look for consumer spending to rebound in April and following months.”

Sales of sporting goods stores like Dick’s Sporting Goods (DKS) and hobby stores like Michael's (MIK) fell 0.8 percent, and restaurants and bars drew 0.6 percent lower sales. Excluding food services, auto dealers, building materials outlets and gasoline stations, retail sales rose 0.5 percent as the retail sector did see pockets of positive momentum last month. Sales of electronics and appliances grew 2.6 percent in the greatest increase since 2015, and clothing store sales increased 1 percent. (See also: Retailers Face Cost Squeeze with Rising Rates.)

Even with the tepid overall sales report, analysts still expect the Federal Reserve Bank to hold their momentum in raising interest rates with a healthy labor market. They also expect sales to pick up in the next few months as more tax refunds get into consumers’ wallets.

"For the Fed, the underlying momentum is more important in terms of policy decisions, and that looks to be strong, supported by a tightening labor market, rising incomes and high consumer confidence," Gregory Daco, head of U.S. macroeconomics at Oxford Economics, told Reuters.

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