Not So Fast

Though many economic observers, including Federal Reserve Board chairman Alan Greenspan, have declared the recession over and recovery upon us, a weaker-than-expected February retail sales increase of just 0.3 percent has tempered the recovery talk.

The weak February performance comes on top of revised January figures, which declared a 0.3 percent decrease for the month. Economists had expected February sales to grow at least 1 percent. Excluding autos, the sales gain was only 0.2 percent.

The disappointing sales figures came on top of a report by the Mortgage Bankers Association of America that mortgage applications tumbled 16 percent from the prior week, a product it seems of mortgage interest rates rising.

Several retail stocks fell on the news of the weak February performance. Wal-Mart stock lost 24 cents a share, The Gap dropped 11 cents and Target fell 74 cents.

Some feel the good news is that consumers are at least buying. “The economy may not be roaring back,” said one economist, “but it is coming back.”

Greenspan had warned a week ago that “lack of pent-up demand in the consumer sector” could dampen the recovery. Yesterday, he said, “In recent days, encouraging signs of strengthening underlying trends in final demand have emerged, although the dimensions of the pickup remain uncertain.”