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Economy in Brief


U.S. Weekly Chain Store Sales Strengthen In April
by Tom Moeller April 6,2010

The passage of a snowy winter may have unleashed consumers' interest in spending money. That was evident in a 2.1% surge in chain store sales last week. Strength is certainly evident in the y/y change which increased to 4.7%, its strongest gain since early-2007.

During the last ten years there has been a 68% 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.

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 weekly figures are available in Haver's SURVEYW database.

The leading indicator of chain store sales also improved. Last week, the index slipped; however, for the month, it rose 1.3% from February and 1.1% versus one year ago. This annual gain is the strongest since August 2007. This 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 Outlook for the Economy and Inflation, and the Case for Federal Reserve Independence is the title of San Francisco Fed President Janet L. Yellen's speech and it can be found here

ICSC-UBS (SA, 1977=100) 04/02/10 03/26/10 03/19/10 Y/Y 2009 2008 2007
Total Weekly Chain Store Sales 512.7 502.0 499.2 4.7% 0.1% 1.4% 2.8%

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