January 2019 Retail Sales

Retail sales improved to start the year according to the delayed release from the Census Bureau.  Their January 2019 release was delayed due to disruptions from the partial government shutdown.  This important indicator managed to gain 0.2 percent, but the prior period was downwardly revised to minus 1.6 percent from minus 1.2 percent.  Year-over-year, this figure is up 2.3 percent.

Details in the report were filled with big moves, both up and down.  Building material and garden equipment & supplies dealers experienced a 3.3 percent jump.  Meanwhile, auto sales declined 2.6 percent in the period.  Then there are sporting goods and hobby types of retailers which increased their receipts by 4.8 percent, while nonstore companies advanced 2.6 percent.  Gasoline stations’ downtick of minus 2.0 percent put their year-over-year figure at minus 4.2 percent.

Despite a weak headline and uneven growth beneath it, Atlas takes comfort in our preferred line item.  Food services and drinking places increased a healthy 0.7 percent.  More importantly, December’s tally was upwardly revised to +0.1 percent from minus 0.7 percent in the prior release.  It appears our nation’s consumers remain comfortable enough in their current situation and expected outcomes that they are willing to increase their discretionary spending.

Headline data left a lot to be desired, but there was enough positive information beneath the headline to create a solid silver lining.  Retail sales represent roughly one-fifth of America’s economy, so this frequently released data are a favorite here at Atlas.  We are already awaiting the next iteration in order to understand better if the weakness in December was simply a statistical anomaly or the beginning of something more persistent. For now, it appears to be the former.