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Economy in Brief

U.S. Retail Sales Are Sluggish
by Tom Moeller  May 13, 2015

Overall retail sales including food services & drinking places during April were little-changed (+0.9% y/y) following a 1.1% March increase, revised from 0.9%. A 0.2% rise had been expected in the Action Economics Forecast Survey. Sales excluding autos gained 0.1% (-0.0% y/y) after a 0.7% advance, revised from 0.4%. A 0.5% increase had been expected. During the last ten years, there has been a 92% correlation between the y/y change in retail sales and the change in real GDP. Sales in the retail control group exclude autos, gasoline, building materials & food services and align with the consumer spending estimates in the GDP accounts. Sales in this grouping were unchanged last month (2.1% y/y) after a 0.5% rise.

A 0.4 decline in auto sales (+4.5% y/y) held back the rise in overall retail spending. It followed a 2.9% jump that was making up February's 2.2% shortfall. The latest decline compares to a 4.0% drop (+2.5% y/y) in unit vehicle sales. Sales of building materials improved 0.3% (4.1% y/y) following a 2.3% jump.

Purchases at furniture & home furnishings outlets declined 0.9% (+1.5% y/y) after a 1.8% rise. Sales at electronics & appliance stores fell 0.4% (-3.5% y/y), the seventh consecutive monthly shortfall. General merchandise store sales were off 0.5% (-1.3% y/y), the second decline in the last three months. Gasoline retailers saw sales fall 0.7% (-22.0% y/y) despite higher gas prices. To the upside, nonstore retailers realized a 0.8% sales improvement (6.3% y/y), the third consecutive monthly rise. Sporting goods, hobby, book & music store sales also jumped 0.8% (6.4% y/y) following two months of strong increase. Sales of clothing and accessories improved 0.2% (1.2% y/y), the weakest of three consecutive monthly gains.

In the nondiscretionary sales categories, health & personal care store sales increased 0.8% (5.3% y/y) following a 0.3% increase. Food & beverage store sales slipped 0.1% (+2.1% y/y), the fourth straight month of slight decline.

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

Looking Forward, Forward Looking: The Path for Monetary Policy is the title of yesterday's presentation by John C. Williams, President and CEO, Federal Reserve Bank of San Francisco. It is available here.

Retail Spending (%) Apr Mar Feb Apr Y/Y 2014 2013 2012
Total Retail Sales & Food Services -0.0 1.1 -0.5 0.9 3.9 3.9 4.9
  Excluding Autos 0.1 0.7 -0.1 -0.0 3.0 2.8 4.0
  Non-Auto Less Gasoline, Building Supplies & Food Services 0.0 0.5 -0.4 2.1 3.2 2.9 3.5
Retail Sales -0.1 1.2 -0.6 -0.1 3.6 3.9 4.8
  Motor Vehicle & Parts -0.4 2.9 -2.2 4.5 7.5 8.4 8.9
 Retail Less Autos -0.0 0.6 -0.2 -1.4 2.5 2.7 3.8
  Gasoline Stations -0.7 0.4 2.5 -22.0 -2.8 -0.5 4.2
Food Service & Drinking Places Sales 0.7 0.8 0.3 8.5 6.2 3.6 5.7
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