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Economy in Brief

U.S. Chain Store Sales Show More Life
by Tom Moeller February 22, 2012

The consumer still is in a mood to spend. Chain store sales rose 3.0% last week (3.2% y/y) and more-than-recovered the prior week's decline. The increase lifted February sales so far by 0.8% versus January when sales fell 3.3% m/m. During the last ten years there has been a 72% 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 0.1% w/w (+3.4% y/y) in the latest period. 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) 02/18/12 02/11/12 02/04/12 Y/Y 2011 2010 2009
Total Weekly Chain Store Sales 521.3 506.2 516.5 3.2% 3.2% 2.9% 0.1%
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