December Retail Sales

December retail sales, according to the Commerce Department, fell 0.3%, surprising many economists, most of whom were looking for a slight increase.  The declines were spread across a wide swath of categories, dragging down the performance of over half the sub-categories that comprise the report.  Core retail sales, which exclude both auto and gasoline sales, declined 0.3% for the month.  Total sales in 2009 declined by 6.2%, which gives the year the distinction of producing the worst annual decline seen since records began being collected in 1992.  It also marks just the second time we have seen retail sales fall over an entire year, 2008 being the first, when they ended down 0.5%.  This data produces a disappointing setback for projections of an imminent recovery, especially since it captures the holiday shopping season.  Remember though, we saw a strong surge in both October and November.  In fact, the November headline total was revised upward by 0.5% to reflect a very strong 1.8% increase while core sales were increased 0.4% to 1.0%.   Statistics are a funny thing, and the same report still provides some encouragement to those economists who see momentum building in our economy.  Compared to December of 2008, monthly sales rose 5.4% after jumping 2.5% in November.  For now, we here at Atlas Indicators will hold to the more optimistic view, having never felt the recovery would move unabated forever upward.  We will see if the new year brings consumers back to the stores when the figures for January are released.