Release Explanation: This report measures the value of sales at the retail level, a very important set of figures that make up a large percentage of the consumer spending numbers. Retail sales are the measure of the total sales of goods and services by retail stores. Retail Sales is an important measure of consumer spending and inflationary pressures. Serviced based economies rely on the strength of the consumer to keep things moving along, this therefore impacts PCE and CPI, the Inflationary reports. A currency will be impacted by this report over time as it reveals the strength of the public in their ability, or desire, to spend. Steady increases in retail sales apply significant inflationary pressures to consumer prices. With retail trade being the foremost indicator for consumer spending, this figure is extremely important in understanding the economy.
Trade Desk Thoughts: Nominal retail sales grew by 1.0% in January, the Census Bureau said today, the first increase in the last seven months. For the year, retail sales have declined 9.7% and for the three months to January, sales were down 9.5% from the same period a year ago.
The uptick in sales could be a correction from the November and December declines; November’s sales were revised down to 2.4% decline from 2.1%, and December's sales were revised to a 3.0% decline from the originally estimated 2.7%.
Retail sales ex-autos, the so-called core rate, rose 0.9%. Core sales from December were revised lower to a 3.2% decline from the originally estimated 3.1%.
January gasoline station sales climbed 2.6% last month. Gas sales fell 15.6% in December. Stripping away sales at gas stations, demand at all other retailers increased 0.9% in January. Excluding auto sales and gas station sales, all other retailers saw sales rise 0.8% in January.
Sales last month climbed 1.6% at clothing stores; 2.6% at electronic stores; 0.8% at eating and drinking places; 1.1% at general merchandise stores; 2.1% at food and beverage stores; and 2.7% at mail order and Internet retailers. Sales at health and personal care stores were unchanged.
Forex Technical Reaction: S&P futures were trading lower by 0.8% before the report and remained virtually unchanged afterwards. The dollar, which had been gaining against the higher-yielding euro, pound and Australian dollar, declined immediately afterwards.
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