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Economy in Brief

Weekly Chain Store Sales Recover Around The Holiday
by Tom Moeller July 7, 2009

The Fourth of July seems to have prompted consumer spending this year. During the latest week, chain store sales ticked up all of 0.1%. That, however, was enough to pull the y/y change up to +0.5% after a y/y gain of 0.6% last week. Maybe the consumer is finding his footing? These are the first positive comparisons since late last year. But the consumer definitely isn't spending with wild abandonee. The latest gains fall well short of the three-to-seven percent growth rates logged during the last several years.

During the last ten years there has been a 69% correlation between the year-to-year growth in chain store sales and the growth in general merchandise sales. The weekly figures are available in Haver's SURVEYW database.

The ICSC-Goldman Sachs 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.

In tandem with the idea that the consumer isn't yet spending freely, the leading indicator of sales ticked up all of 0.1% during the latest week. That uptick left the indicator down 2.5% y/y and it has been flat-to-lower all this year.

Exit Strategies for the Federal Reserve from the Federal Reserve Bank of St. Louis can be found here.

ICSC-UBS (SA, 1977=100) 07/04/09 06/27/09 Y/Y 2008 2007 2006
Total Weekly Chain Store Sales 493.8 493.4 0.5% 1.4% 2.8% 3.3%
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