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Cramer: Retail sales revision is devastating

Retail sales weakness
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Retail sales weakness

While U.S. retail sales fell less than expected in February, the sharp downward revision to January's sales could be "devastating" for investors, CNBC's Jim Cramer said Tuesday.

"I'm just kind of flummoxed. A number comes out that makes us feel great, and then that number is taken away," Cramer said on "Squawk on the Street."

The Commerce Department said earlier in the day that retail sales dipped 0.1 percent last month as automobile purchases slowed and cheaper gasoline undercut receipts at service stations.

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January's sales were revised to show a 0.4 percent decline instead of the previously reported 0.2 percent increase. Economists polled by Reuters had forecast retail sales slipping 0.2 percent in February.

Following the data release, Barclays cut its U.S. GDP forecast to 1.9 percent from 2.4 percent.

Cramer said strong retail sales number made investors feel more confident, but this revision has reignited concerns about the economy's growth prospects.

"I took great heart when we got that retail sales number last time. And now I feel like wait a second, what was I taking great heart in because it was wrong."

— Reuters contributed to this report.