We have been trained for years that soaring inflation doesn't matter if it is not reflected in the core CPI, excluding food and energy prices. However, when it comes to retail sales data, all we strip out is autos. The ugly truth is that if we take out the impact of surging gasoline and food prices, retail sales in January were flat.
Retail Sales, total rose 0.3% M/M and 3.9% Y/Y.
Retail Sales, ex-autos rose 0.3% M/M and 4.9% Y/Y.
Sales at gasoline stations surged 2.0% M/M and 23.5% Y/Y.
Grocery Store sales rose 0.3% M/M and 5.3% Y/Y. (See here).
Building materials sales fell (1.7%) M/M and (4.8%) Y/Y.
Clothing & Accessories sales rose 1.4% M/M but fell (0.1%) Y/Y.
Restaurant sales fell (0.5%) M/M but rose 4.4% Y/Y. (Bob Evans (BOBE), Panera Bread (PNRA), Rick's Cabaret (RICK) and P.F. Chang's (PFCB) all topped earnings expectations after Tuesday's market close.)
Motor Vehicles & Parts rose 0.6% M/M, but fell (0.2%) Y/Y.
Bottom Line: The U.S. consumer continues to maintain a tight hold in her purse strings. The S&P Retail Index [RLX] is flat after 30 minutes of trading. It had jumped out to a 1% advance in the opening minutes of yesterday's trading session.