NEW YORK — The U.S. Commerce Department reported that retail sales rose by 0.6% in February, rebounding from a 0.1% decline in January.

Sales at motor vehicle and auto parts dealerships increased by 1.2% in February, according to the Commerce Department. Excluding motor vehicle and auto parts dealerships, retail sales increased by 0.4% in February, according to the Commerce Department.

Several retail categories showed gains in February. Sales at health and personal care stores increased by 2.3%, according to the Commerce Department. Sales at clothing and accessories stores rose by 2%, according to the Commerce Department. Sales at online retailers rose by 0.7%, according to the Commerce Department. Sales at electronics and appliance stores increased by 0.5%, and sales at restaurants increased by 0.4%, according to the Commerce Department.

"This was a solid report," said Ksenia Bushmeneva, economist at TD Bank Group. At the start of the year, shoppers reduced their spending due to severe winter storms.

The retail sales data do not include spending on travel and hotel stays. Higher gas prices at the pump are likely to boost overall retail sales in March because government retail sales figures are not adjusted for inflation, according to Bushmeneva.

The national average price of a gallon of regular gasoline exceeded $4 on Tuesday for the first time since 2022. The average price of a gallon of regular gasoline increased by 4 cents overnight after surpassing $4 a gallon. The national average price for a gallon of regular gasoline was $4.06 on Wednesday.

The Iran war began on February 28, 2026. The Iran war has shut down the Strait of Hormuz, cutting off one-fifth of the world's oil supply. The price of a barrel of Brent crude has increased by more than 45% since the start of the war.

"The hit to real incomes from higher gas prices is especially regressive, hurting lower-income households disproportionately, while the lift from tax refunds is more evenly spread," said Samuel Tombs, chief economist at Pantheon Economics. "Moreover, refunds will slow to a trickle by late April, providing little protection if high prices persist."

Higher gas prices are expected to reduce real household incomes by roughly $15 billion per month, according to Tombs. Gas prices are approaching 3% of household median income, according to Patrick De Haan, analyst at GasBuddy.

"When that gets up to about 4, 4 1/2, 5%, that's really when people really start trimming back on some of their discretionary purchases," said De Haan.

The cost of diesel fuel has risen faster than gasoline, increasing transportation costs for companies. The national average price for a gallon of regular gasoline is one dollar higher than it was before the Iran war.