U.S. Retail Sales Increase Boosted By Auto Purchases

Consumers were in a spending mood at the end of last year. Total retail sales rose 0.5% following a 0.4% November increase which was revised up from 0.3%. A 0.2% rise in December sales had been expected, according to Action Economics. Retail sales excluding autos rose 0.3% after a revised 0.1% November rise. A 0.2% rise was expected. For the full year, the consumer spent at a rate that was moderately below 2011. Sales rose 5.0% last year after an 8.0% gain in 2011 while nonauto sales rose 4.5% after 2011's 7.4% advance.

Motor vehicle purchases rose 1.6% in December (7.6% y/y) and they were up 7.7% for the full year. A slip, however, in seasonally adjusted gasoline prices, as calculated by Haver Analytics, offset that increase. Spending at gasoline service stations fell 1.6% (+2.0% y/y). Excluding both gasoline and autos, retail sales rose a steady 0.4% (3.8% y/y) following a downwardly revised 0.5% November rise. For the year, these sales increased 4.1% after a 5.9% rise in 2011. Sales of building materials & garden equipment were unchanged last month (2.0% y/y). A good indication of consumers' interest in spending on discretionary items are sales without these volatile components. Excluding autos, gasoline and building materials, retail sales rose a respectable 0.5% (3.8% y/y) last month. For the full year, however, the 3.9% rise in 2012 was down from a 6.1% gain in 2011.

Sales of apparel & accessory stores jumped 1.0% last month (5.1% y/y) and for the year rose 5.5%, about even with the 2011 increase. Purchases of home furnishings, appliances and electronics increased 0.4% (3.6% y/y), although the full-year gain of 3.0% was more-than-double the advance in 2011. Higher sales at furniture stores led last month's gain with a 1.4% increase (6.1% y/y), while they were up 7.7% for the full year. Working the other way, sales of electronics & appliances fell 0.6% last month (+1.3% y/y) and for the full year declined 1.1%. Also, December general merchandise purchases slipped marginally (-2.0% y/y), off for the fourth straight month, and rose just 0.4% for the year. December sales of food & beverages stores jumped 1.2% (7.7% y/y) for the second consecutive month while sales of nonstore retailers rose 0.5% (12.6% y/y).

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

The Economy and Monetary Policy in Uncertain Times is the title of yesterday's speech by John C. Williams, President and CEO of the Federal Reserve Bank of San Francisco and it can be found here.