January Retail Sales: Down 0.2% MoM

The Census Bureau's Advance Retail Sales Report for February was released Monday morning. Headline sales came in at -0.2% month-over-month to one decimal and was worse than the Investing.com forecast of 0.3%.Core sales (ex Autos) came in at -0.42% MoM (to two decimals).

Here is the introduction from today's report:

Advance estimates of U.S. retail and food services sales for February 2019, adjusted for seasonal variation and holiday and trading-day differences, but not for price changes, were $506.0 billion, a decrease of 0.2 percent (±0.5 percent)* from the previous month, but 2.2 percent (±0.7 percent) above February 2018. Total sales for the December 2018 through February 2019 period were up 2.2 percent (±0.5 percent) from the same period a year ago. The December 2018 to January 2019 percent change was revised from up 0.2 percent (±0.5 percent)* to up 0.7 percent (±0.3 percent).

Retail trade sales were down 0.2 percent (±0.5 percent)* from January 2019, but 2.1 percent (±0.5 percent) above last year. Nonstore retailers were up 10.0 percent (±1.8 percent) from February 2018, while health and personal care stores were up 5.9 percent (±2.5 percent) from last year. [view full report]

The chart below is a log-scale snapshot of retail sales since the early 1990s. The two exponential regressions through the data help us to evaluate the long-term trend of this key economic indicator.

Retail Sales Trends

 

The year-over-year percent change provides another perspective on the historical trend. Here is the headline series.

Retail Sales YoY

 

Core Sales

Here is the year-over-year version of Core Retail Sales.

Core Retail Sales YoY

 

"Control" Purchases

The next two charts illustrate retail sales "Control" purchases, which is an even more "Core" view of retail sales. This series excludes Motor Vehicles & Parts, Gasoline, Building Materials as well as Food Services & Drinking Places. The popular financial press typically ignores this series, but it a more consistent and reliable reading of the economy.

Control Sales Trends

 

Here is the same series year-over-year. Note that the current level is above both highlighted values at the start of recessions since the inception of this series in the early 1990s.

Control Sales YoY

 

For a better sense of the reduced volatility of the "Control" series, here is a YoY overlay with the headline retail sales.

Headline and Control YoY

 

Bottom Line: February sales showed a decrease month over month and were worse than forecasts. When FRED publishes their data, we'll take a closer look at Real Retail Sales.

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