* U.S. March same-store sales expected to fall 0.7 pct
* Late Easter, inflation likely trimmed sales
CHICAGO, April 7 (Reuters) - March is not looking to be as bad as expected for U.S. retailers, at least as far as initial sales reports show.
U.S. retailers are likely to show a drop in March same-store sales, hurt by Easter falling three weeks later than last year, which delays some spring clothing purchases.
Chilly weather and rising inflation were also expected to hurt discretionary purchases.
But retailers that report their monthly sales earlier than most, including drugstore operator Walgreen Co and teen apparel retailers Hot Topic Inc and Zumiez Inc , reported better than-expected sales for the month. [ID:nL3E7F634W].
Sales at stores open at least a year, or same-store sales, are expected to fall 0.7 percent when tallying results from 25 retailers, according to Thomson Reuters.
With Easter falling on April 24 this year, 20 days later than in 2010, the bulk of sales of spring clothing, candy and other goods are expected to be delayed until April. [ID:nN05116416]
At the same time, shoppers have already started to pay more for groceries and gasoline, reducing the amount left for discretionary purchases.
Craig Johnson, president of Customer Growth Partners, said visits to stores showed the "first major impact of inflation on retail spending, particularly discretionary spend, in many years."
While unemployment remains high, it has edged down in recent months.
"This March I spent more than last March because I was searching for a job last March," said Jane Marcinkiewicz, a 37-year-old mother of two from New York's Harlem neighborhood, who works part-time at a department store.
Figures being released by companies this week will not paint the full picture of the consumer economy as the retailers that still issue monthly sales figures account for only 10 percent of total U.S. retail sales, Johnson noted.
Major retailers such as Wal-Mart Stores Inc , Home Depot Inc and large grocers do not issue monthly sales reports and several apparel chains recently abandoned the practice as well.
Walgreen Co, one of the largest companies that still issues monthly sales reports, said on Tuesday that its March same-store sales rose 3 percent, with sales of general merchandise beating expectations. (Reporting by Jessica Wohl and Brad Dorfman in Chicago and Dhanya Skariachan in New York; Editing by Phil Berlowitz)