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Economy in Brief

U.S. Retail Sales Ease; Weakness Is Broad-Based
by Tom Moeller  January 15, 2016

Consumers reined in their spending for the holiday season. Purchases at retail stores and restaurants eased 0.1% during December (+2.8% y/y) following a 0.4% November rise, revised from 0.2%. For all of last year, sales advanced 2.1%, the weakest increase since a decline in 2009. The latest rise disappointed expectations for a 0.1% rise in the Action Economics Forecast Survey.

An unchanged dollar value of motor vehicle sales compared to a 4.6% decline in unit vehicle sales. Retail sales elsewhere, however, were weak as they also posted a 0.1% dip. Lower gasoline prices also restrained the dollar value of spending with a 1.1% drop (-14.4% y/y), the sixth consecutive monthly fall. Overall retail sales excluding autos and gasoline as well as building materials and restaurants declined 0.3% (+2.8% y/y) after a 0.5% rise.

Sales in most discretionary spending categories weakened, led by a 1.0% decline in general merchandise store sales which also were unchanged y/y. It was the third monthly decline in a row. Clothing & accessory store sales fell 0.9% (+1.4% y/y), the fourth decline in five months. Electronics & accessory store sales eased 0.3% (-3.5% y/y), down for the third straight month.

Bucking the downward trend was a 0.4% gain in home furnishings sales (0.9% y/y) after falling for two months. Also moving higher by 0.9% (7.8% y/y) were sales of sporting goods, hobby, book & music stores, the fourth straight month of gain. Building materials & garden equipment sales rose 0.7% (4.8% y/y) while sales over the internet improved 0.3% (8.0% y/y). Eating out also compensated a bit for restraint elsewhere as restaurant sales gained 0.8% (7.5% y/y).

In the nondiscretionary spending categories, food & beverage store sales dipped 0.3% (+2.1% y/y), the third decline in four months. Health & personal care store sales gained 0.2% (3.5% y/y) for the second straight month.

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

The U.S. Economic Outlook and Implications for Monetary Policy is the title of New York Fed Chairman William C. Dudley's speech and it can be found here.

Retail Spending (%) Dec Nov Oct Dec Y/Y 2015 2014 2013
Total Retail Sales & Food Services -0.1 0.4 0.0 2.8 2.1 3.9 3.7
  Excluding Autos -0.1 0.3 0.1 2.0 0.9 3.1 2.7
  Non-Auto Less Gasoline, Building Supplies & Food Services -0.3 0.5 0.1 2.8 3.0 3.3 2.7
Retail Sales -0.2 0.3 -0.1 2.2 1.4 3.7 3.8
  Motor Vehicle & Parts 0.0 0.5 -0.3 6.4 7.0 7.5 8.3
 Retail Less Autos -0.3 0.2 0.0 1.2 -0.2 2.6 2.6
  Gasoline Stations -1.1 -1.3 -1.1 -14.4 -19.4 -2.7 -0.7
Food Service & Drinking Places Sales 0.8 1.0 0.6 7.5 8.1 6.2 3.4
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