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Economy in Brief

U.S. Chain Store Sales Reverse Earlier Gain
by Tom Moeller  September 20, 2011

Chain store sales continue lethargic. Last week they fell 1.2% (+3.4% y/y) and fully reversed the prior period's gain. So far in September sales are down 1.0% from August when they fell 1.8% versus the July peak. During the last ten years there has been a 66% correlation between the y/y change in chain store sales and the change in retail sales at general merchandise stores. That correlation recently has increased. General merchandise store sales account for 15% of total retail sales.

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. 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 retail sales.

The leading indicator of chain store sales slipped 0.4% (-1.7% y/y) after having been unchanged during the prior week. The composite leading economic indicator is compiled from four series: (1) the MBA's volume index of mortgage applications for home purchase (2) the ABC News/Money magazine's survey of consumer buying conditions (3) new filings for jobless benefits and (4) the 30-year government bond yield.

The chain store sales data are in Haver's SURVEYW.

ICSC-UBS (SA, 1977=100) 9/17/11 9/10/11 9/3/11 Y/Y 2010 2009 2008
Total Weekly Chain Store Sales 517.3 523.8 516.9 3.4% 2.9% 0.1% 1.4%
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