ACTIONABLE ADVICE FOR FINANCIAL ADVISORS: Newsletters and Commentaries Focused on Investment Strategy

Follow us on

Content Channels

Most Popular This Month

Most Popular This Year

Retail Sales: December Numbers Are a Huge Disappointment

January 15, 2016

by Doug Short

The Census Bureau's Advance Retail Sales Report released this morning shows that seasonally adjusted sales in December decreased 0.1% month-over-month and are up 2.2% year-over-year. Core Retail Sales (ex Autos) also declined 0.1% MoM and are up only 1.2% YoY

The Investing.com forecasts were 0.1% for Headline and 0.2% for Core Sales.

The chart below is a log-scale snapshot of retail sales since the early 1990s. The two exponential regressions through the data help us to evaluate the long-term trend of this key economic indicator.

Retail Sales Trends

The year-over-year percent change provides another perspective on the historical trend. Here is the headline series.

Retail Sales YoY

Here is the year-over-year version of Core Retail Sales.

Core Retail Sales YoY


Retail Sales: "Control" Purchases

The next two charts illustrate retail sales "Control" purchases, which is an even more "Core" view of retail sales. This series excludes Motor Vehicles & Parts, Gasoline, Building Materials as well as Food Services & Drinking Places.

Control Sales Trends

Here is the same series year-over-year. Note the highlighted values at the start of the two recessions since the inception of this series in the early 1990s.

Control Sales YoY

For a better sense of the reduced volatility of the "Control" series, here is a YoY overlay with the headline retail sales.

Headline and Control YoY

Bottom Line: The holiday season December Retail Sales were a huge disappointment, and YoY Core Retail Sales and Control Sales are lower than they were at the start of the last two recessions. When the December Consumer Price Index is released next week, we'll take a look Real Retail Sales.