NEW YORK (TheStreet) -- Just as Mother Nature sent one last "I'm the boss here" blast of cold and snow to the Northeast, today's retail sales report for February looks suspiciously like a crocus, heralding a much warmer economy this spring.
The top line of the report was fine: Retail sales rose 0.3% from January, despite all the crazy weather, narrowly beating forecasts for a 0.2% gain. But the really good part was in the details. The industries that need to perk up for spring and summer to match relatively high expectations are mostly performing well, and the ones that are in the dumps don't seem ominous with a little thought.
WATCH: Retail Sales Gain for First Time in Three Months, Jobless Claims Dip
Let's dispatch the bad news first.
Out of the box, dismiss the 0.1% gain in gasoline sales, which were nearly 5% lower than a year ago. The whole drop can be explained by lower gas prices, especially in the first two weeks of February.
Next -- and this is a big one -- discount the fact that auto sales rose 0.3% in February and 2.2% over a year ago. (Auto sales, as 19% of all retail sales, matter a lot). True, the year-over-year pace is less than a third of the gain reported this time last year. But car lots are among the businesses most affected by the weather, and Credit Union National Association chief economist Bill Hampel said last week that car sales growth will rebound as the weather warms. Fundamentally, the U.S. auto fleet is still nearly as old as it's ever been, and people's job security is much stronger than it has been, he says.
Then, have a drink and relax at the slowing growth of restaurant sales. They're up 2.5% for the first two months of the year, down from 3.4% growth last year. But that money is replaced, dollar for dollar and then some, in faster growth at grocery stores. People stayed home, and that's all there is to that story.
Now for the good news.
Building materials sales rose 3.2% from last year over the first two months of 2014 -- a little below last year's 3.7%, but solid. It points to people upgrading and feeling confident. General merchandise store sales were little changed, but they were shrinking this time last year. And non-store (read, online) retailers and apparel merchants both bounced back last month from weak January performances that sparked speculation that the post-holiday lull pointed to more problems than just the cold.
That's why economists at PNC Financial made clear yesterday that it was no big deal that they were reducing their estimates of first-quarter U.S. growth -- at the same time, they raised their second-quarter estimates even more. They now think the economy is growing at a 2.2% annual rate in the first quarter, down from their estimate of 2.5% before, but it will grow 3.2% in the second quarter instead of 2.7%. Like the snow, the economic slowdown will simply melt away, economists Stuart Hoffman and Gus Faucher said.
Growth this year will still be 50% better than last year -- or 2.8% instead of 1.9%, the PNC team says. And their forecast is close to the consensus. By spring, Hampel says we'll return to monthly jobs gains of 200,000 or more.
And naturally, that means the Federal Reserve
will keep tapering.
Next Tuesday's housing starts figures loom as the next big place to confirm or refute that idea. But with retail sales budding, the economy's case of spring fever is coming into sharper focus.
This article represents the opinion of a contributor and not necessarily that of TheStreet or its editorial staff.
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