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Economy in Brief

U.S. Chain Store Sales Stutter
by Tom Moeller November 22, 2011

Chain store sales fell 0.9% last week following gains during the prior three weeks. As a result, the average for this month so far is up 1.0% (2.8% y/y) from October when sales fell 0.6% m/m. 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 gained 0.3% w/w (0.9% y/y) in the latest period to lift the month 1.0% above October. 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) 11/19/11 11/12/11 11/5/11 Y/Y 2010 2009 2008
Total Weekly Chain Store Sales 517.8 522.6 521.0 2.8% 2.9% 0.1% 1.4%
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