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Economy in Brief

Chain Store Sales Soft as Gasoline Prices Surged
by Tom Moeller April 4, 2006

Chain store sales tread water last week, according to the International Council of Shopping Centers (ICSC)-UBS survey.The unchanged w/w level of sales followed three consecutive periods of decline.

Sales began April 1.4% lower than at the start of March but the average level of sales last month did rise 0.7% versus February.

During the last ten years there has been a 47% correlation between the y/y change in chain store sales and the change in nonauto retail sales less gasoline.

The leading indicator of chain store sales rose 0.5% (0.5% /y) after the prior week's 0.1% up tick. The March rose 0.3% from February.

The ICSC-UBS retail chain-store sales index is constructed using the same-store sales (stores open for one year) reported by 78 stores of seven retailers: Dayton Hudson, Federated, Kmart, May, J.C. Penney, Sears and Wal-Mart.

Retail gasoline prices opened April with a nine cent w/w increase to $2.59 per gallon (16.7% y/y). In yesterday's spot market trading the price for regular unleaded gasoline of $1.92 per gallon was up another two cents from last week's average.

The strength in gasoline prices has been helped by growing U.S. gasoline demand which rose 3.3% last month from the February average and 0.3% y/y.

ICSC-UBS (SA, 1977=100) 04/01/06 03/25/06 Y/Y 2005 2004 2003
Total Weekly Chain Store Sales 462.3 462.4 2.4% 3.6% 4.7% 2.9%
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