Retail Sales in January

Last month, even in the face of disappointing numbers, we said we were optimistic that an improving trend in retail sales seemed to be developing.  January’s totals validate that assessment, rising .5% at the headline level and .6% at the core which excludes auto and gasoline sales.  Further, December’s numbers were revised up a bit although, at minus 0.1%, they still contracted.  On an annualized basis sales are still negative, off 4.7%, extending a losing streak which has helped craft the label of Great Recession this global economic slowdown has earned.  The core figures have fared no better, down 4.6% year-over-year.  However, recent changes in some of the employment statistics cause us to retain our rosier outlook and we’ll move the needle for this indicator up another notch to the nine o’clock position, but with some measure of trepidation.  What we seem to be seeing is a cautious consumer looking for those bargains expected to appear in the post-holiday season, as well as gift card redemptions.  Those influences have likely run their string and we’ll need to see impetus arise from other quarters if the consumer is to continue being inclined to spend.  This is when true recovery must ignite, allowing outside stimulus programs to end and growth to become self-sustaining.  Will it happen?  We’ll let you know.