Retail Sales Growth Disappoints In December 2018

Retail sales was significantly slower according to US Census headline data. There is almost no year-over-year growth when one inflation adjusts the data.

Analyst Opinion of Retail Sales

There was a slight downward adjustment of last month's data. The real test of strength is the rolling averages which declined.

Things to consider when viewing this data:

  • it is not inflation adjusted - and when you do there is almost no growth year-over-year.
  • the three-month rolling averages of the unadjusted data declined.

The year-over-year growth rate in inflation-adjusted retail sales and retail employment have diverged.

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Backward data revisions were upward.

Econintersect Analysis:

  • unadjusted sales rate of growth decelerated 3.5 % month-over-month, and up1.4 % year-over-year.
  • unadjusted sales 3-month rolling year-over-year average growth decelerated 3.1 % month-over-month, up 4.2 % year-over-year.

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  • unadjusted sales (but inflation adjusted) up 0.2 % year-over-year
  • this is an advance report. Please see caveats below-showing variations between the advance report and the "final".
  • in the seasonally adjusted data - the weakness was widespread.

U.S. Census Headlines:

  • seasonally adjusted sales down 1.2 % month-over-month, up 2.3 % year-over-year (published up 4.6 % YoY last month).
  • the market was expecting (from Econoday):

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Year-over-Year Change - Unadjusted Retail Sales (blue line) and Inflation Adjusted Retail Sales (red line)

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Retail sales per capita growth trend is mixed depending on periods selected - see graph below.

Year-over-Year Percent Change - Per Capita Seasonally Adjusted Retail Sales

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From the U.S. Census Bureau press release:

Advance estimates of U.S. retail and food services sales for December 2018, adjusted for seasonal variation and holiday and trading-day differences, but not for price changes, were $505.8 billion, a decrease of 1.2 percent (±0.5 percent) from the previous month, but 2.3 percent (±0.5 percent) above December 2017. Total sales for the 12 months of 2018 were up 5.0 percent (±1.4 percent) from 2017. Total sales for the October 2018 through December 2018 period were up 3.7 percent (±0.5 percent) from the same period a year ago. The October 2018 to November 2018 percent change was revised from up 0.2 percent (±0.5 percent)* to up 0.1 percent (±0.4 percent)*. Retail trade sales were down 1.3 percent (±0.5 percent) from November 2018, but 2.1 percent (±0.5 percent) above last year. Clothing and clothing accessories stores were up 4.7 percent (±1.4 percent) from December 2017, while food services and drinking places were up 4.0 percent (±2.5 percent) from last year.

General Information

Data collection and processing were delayed for this indicator release due to the lapse in federal funding from December 22, 2018 through January 25, 2019. Processing and data quality were monitored throughout and response rates were at or above normal levels for this release.

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Gary Anderson 9 months ago Contributor's comment

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