For Immediate Release

April 26, 2006

LANSING — Michigan retailers have tempered their outlook for 2nd Quarter sales after a slow March.

March’s Michigan Retail Index, a survey project of the Michigan Retailers Association (MRA) and Federal Reserve Bank of Chicago, found the biggest drop in short-term sales forecasts in the past four months. The industry’s overall sales performance for the month also fell, the second consecutive month of decline.

“A late Easter, higher interest rates and Michigan’s struggling economy all contributed to the sales fall-off in March,” said MRA Chairman and CEO Larry Meyer. “All those factors, plus the specter of gasoline topping $3 a gallon by summer, are no doubt cutting into retailers’ previous projections for short-term sales.”

The Index found that 36 percent of retailers increased sales in March over the same month last year while 48 percent recorded declines and 16 percent saw no change. The results create a seasonally adjusted performance index of 42.0, down from 47.5 in February and 54.3 in January.

In addition, 57 percent believe their sales will increase for April–June, while 17 percent forecast declines and 26 percent project no change. The results create a seasonally adjusted outlook index of 63.2, down sharply from 72.0 in February.

Northern Michigan retailers posted the best overall March performance, with 48 percent ringing up higher sales. Central Michigan retailers were the most optimistic, with 71 percent forecasting short-term gains.

The Michigan Retailers Association is the unified voice of retailing in Michigan and the nation’s largest state trade association of general merchandise retailers.

Note: William Strauss, Senior Economist and Economic Advisor with the Federal Reserve Bank of Chicago, can be reached at 312.322.8151.