Retail Sales Growth Disappoints In December 2018

Seasonally Adjusted Retail Sales - All (red line), All except food services (blue line), and All except motor vehicles (green line)

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The differences between the headlines and Econintersect are due to different approaches to seasonal adjustment (see caveats at the end of this post).

Comparison of the Year-over-Year Census Seasonally Adjusted Retail Sales (blue line) and Econintersect's Unadjusted Retail Sales (red line)

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Declines of short duration often occur in the seasonally adjusted series without a recession resulting.

Retail and Food Services Sales - Seasonally Adjusted

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Using employment as a gauge to check growth, employment in retail has been declining.

Retail Employment - Total Seasonally Adjusted (blue line, left axis) and Year-over-Year Change Unadjusted (red line, right axis)

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And finally, as retail sales can be a component of determining a recession start date, the zero line of the graph below could be an indicator a recession was underway (or about to begin).

Retail Sales - Recession Watch Graph

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Caveats On Advance Retail Sales

This data release is based on estimates. However, the estimates have proven to be fairly accurate although tend to miss at economic turning points. Therefore up to three months are subject to backward revisions, although normally slight, can sometimes be modest.

The data in this series is not inflation adjusted - and Econintersect adjusts using CPI less shelter CUSR0000SA0L2. The St. Louis Fed also inflation adjusts the Census seasonally adjusted data. The last two recessions began as the inflation adjusted retail sales crossed the zero growth line.

Comparison of Real Year-over-Year Growth between FRED's Real Retail Sales (green line) and Econintersect's Inflation Adjusted Retail Sales

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