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Economy in Brief

U.S. Retail Sales Regain Forward Momentum
by Tom Moeller  March 11, 2011

Total retail and food service sales rose last month by 1.0% following a 0.7% January increase, revised up from 0.3%. Sales have risen for eight consecutive months and the latest increase lifted the y/y increase to 8.9%, the strongest since mid-2005. The February rise beat Consensus expectations for a 0.8% gain, according to the Action Economics survey. During the last three months, sales rose at a 9.7% annual rate versus a 6.5% increase during all of last year. Excluding autos, sales rose 0.7% last month after an upwardly revised January gain. The increase roughly matched expectations for a 0.6% rise. During the last three months, nonauto sales rose at a 6.4% rate after a 5.8% increase last year.

Motor vehicle sales rose another 2.3% and contrasted with the 6.4% increase in unit sales, reported earlier this month. In addition, higher gasoline prices pulled sales of gasoline service stations up another 1.4% and at a 19.5% annual rate since November. Excluding sales of autos and gasoline, retail sales rose 0.5% in February and at a 4.7% annual rate during the last three months.

Discretionary spending amongst other categories was firm. Clothing store sales rose 0.8% (3.8% y/y) after a 0.9% January gain. Sales at general merchandise outlets increased 0.7% (2.6% y/y) and matched the January increase. Building material store sales rose 0.6% but that recouped only half of the weather-induced January decline. Sales at furniture & home furnishing stores remained weak and inched up just 0.1% (-3.0% y/y) after four consecutive months of decline. Sales at electronics & appliance stores rose a 0.9% (-2.2% y/y) but have declined at a 0.8% during the last three months. Sales of non-store retailers slipped 0.3% in February (+12.6% y/y). Currently, sales by electronic shopping & mail-order houses account for roughly ten percent of nonauto retail sales less building materials & gasoline. Finally, sales at food service & drinking places jumped 1.3% (3.8% y/y).

The retail sales figure are available in Haver's USECON database. The Action Economics figures are in the AS1REPNA database.

Retail Spending (%) Feb Jan Dec Feb Y/Y 2010 2009 2008
Total Retail Sales & Food Services 1.0 0.7 0.6 8.9 6.5 -6.4 -1.0
  Excluding Autos 0.7 0.6 0.3 6.0 5.8 -5.1 2.3
Retail Sales 0.9 0.8 0.7 9.5 6.9 -7.1 -1.4
   Motor Vehicle & Parts 2.3 1.2 2.3 23.7 10.3 -12.1 -13.9
 Retail excluding Autos 0.6 0.7 0.3 6.3 6.2 -5.9 2.3
   Gasoline 1.4 1.3 1.8 12.9 16.2 -24.7 9.9
 Non-Auto Less Gasoline 0.5 0.6 0.0 5.3 4.8 -2.4 1.0
Food Service 1.2 0.1 0.2 3.8 2.9 0.5 2.4
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