–Ex Auto & Gas +0.2%; Autos +0.4%, Gasoline +1.4% as Prices Rise
By Joseph Plocek
WASHINGTON (MNI) – U.S. January retail sales data disappointed.
January sales printed +0.3% overall, +0.3% ex auto, and +0.2% ex
auto and gas, all about 0.2 point below expectations. Also, December
sales were revised lower so Q1 has a lower growth trajectory.
The result was below expectations and suggests consumption was
slowing at the start of the year after two good months.
January sales were held down by -0.3% in furniture, -2.9% building
materials (worst since -8.9% in May 2010), -0.3% clothing, -1.3%
sporting goods (worst since -1.5% in April 2010), and -0.7% restaurants
(worst since -0.9% in March 2009). The month’s gains were in autos at
+0.5%, electronics +0.3%, food +1.3%, healthcare +0.5%, and gasoline
+1.4% (after +1.8% in December). The latter was probably mostly a
continuing price effect.
Once again, January chain store results appeared to have out-paced
general sales, as they did in December, suggesting smaller retailers
lagged.
There are still reasons to think sales can pick up ahead: a payroll
tax cut will continue to boost take-home pay and payrolls are slowly
rising, as are wealth effects from higher stocks and steadying home
values. So it is too soon to downgrade the Q1 outlook on this one
disappointing January data set.
After all, unadjusted retail sales fell $96 billion in January,
compared to an $87 billion drop last January. The seasonal adjustment
accounted for the entire rise in both years.
Rather we consider the January sales results a buying pause at the
start of the year. It is possible that a more cautious consumer paid off
holiday bills or stepped up savings rather than spending his fatter pay
check.
**Market News International Washington Bureau: (202)371-2121**
[TOPICS: MAUDS$,M$U$$$,MT$$$$,MAUDR$]
