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Economy in Brief

U.S. Retail Sales Start Holiday Season on Solid Ground
by Tom Moeller  December 14, 2018

Consumers continued to exhibit their inclination to spend as holiday shopping got underway. Total retail sales rose 0.2% during November (4.9% y/y) following a 1.1% October jump, revised from 0.8%. The latest increase matched expectations in the Action Economics Forecast Survey. Excluding motor vehicles and parts, retail sales gained 0.2% (5.7% y/y) after a 1.0% increase, revised from 0.7%. A 0.3% improvement had been expected.

A measure of the underlying pace of retail spending is nonauto sales growth excluding gasoline and building materials. These sales surged 0.9% (5.2% y/y) and built on a 0.7% October gain, revised from 0.3%.

Strength in sales was notable for online retailers whose sales increased 2.3% (12.1% y/y) following two months of strong gain. Purchases at electronics & appliance stores similarly were firm as they rose 1.4% (5.0% y/y), about as they did during the prior month. Furniture & home furnishings store sales grew 1.2% (2.9% y/y) after a moderate decline. General merchandise store sales gained 0.4% (4.2% y/y) after a 0.8% rise. Sporting goods, hobby shop, book & music store sales also improved 0.4% (-7.8% y/y) following a 1.1% increase. Motor vehicle & parts dealership sales gained 0.2% (1.4% y/y) even as unit motor vehicle sales eased 0.2% m/m.

Reflecting lower prices, gasoline service station sales declined 2.3% (+8.7% y/y) after a 3.2% jump. Also working lower were clothing & accessory store sales by 0.2% (+4.1% y/y) after two months of firm increase. Building materials & garden equipment store sales also were weak. They fell 0.3% (+3.5% y/y) on the heels of a 1.5% strengthening.

Sales of nondiscretionary items were firm last month. Health & personal care product store sales increased 0.9% (3.6% y/y) after falling for three straight months. Food & beverage store sales gained 0.4% (3.3% y/y) after a 0.3% rise.

Eating out was less in vogue during November as restaurant & drinking establishment sales declined 0.5% after a 0.6% increase, revised up from a moderate decline. Sales have lost forward momentum, however, as the 6.9% y/y increase moderated from 10.9% y/y growth just three months earlier.

The retail sales data can be found in Haver's USECON database. The Action Economics forecast is in the AS1REPNA database.

Retail Spending (% chg) Nov Oct Sep Nov Y/Y 2017 2016 2015
Total Retail Sales & Food Services 0.2 1.1 -0.2 4.9 4.3 3.1 2.6
  Excluding Autos 0.2 1.0 -0.3 5.7 4.3 2.7 1.4
Retail Sales 0.3 1.2 -0.0 4.6 4.5 2.8 1.9
  Motor Vehicle & Parts 0.2 1.5 -0.0 1.4 4.3 4.6 7.2
 Retail Less Autos 0.4 1.1 -0.0 5.5 4.5 2.2 0.4
  Gasoline Stations -2.3 3.2 -1.3 8.7 8.8 -5.7 -17.6
Food Service & Drinking Places Sales -0.5 0.6 -1.6 6.9 2.7 5.6 8.2
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