August Advance Retail Sales Disappoint

Includes: PMR, RETL, RTH, UGA, XRT
by: Doug Short

The Advance Retail Sales Report released Friday morning shows that sales in August came in at 0.2% month-over-month, a decline from July's 0.4% (an upward revision from 0.2%). Friday's headline number came below the forecast of 0.4%. Similarly, Core Retail Sales (which excludes Autos) were up only 0.1%, a substantial decline from last month's 0.6% (an upward revision from 0.5%). was looking for 0.3%.

The first chart below is a log-scale snapshot of retail sales since the early 1990s. I've included an inset to show the trend in this indicator over the past several months.

Here is the Core version, which excludes autos.

Here is a year-over-year snapshot of overall series. Here we can see that the YoY series is off its peak in June of 2011 and has been relatively range-bound since April of last year.

Here is the same chart excluding the volatile gasoline component.

Here is an overlay of the two since 2000, which gives us a better sense of the added YoY volatility that gasoline is responsible for in the overall retail sales number. For more on gasoline price volatility, see this weekly update.

After the August Consumer Price Index is released on the 17th, we'll take a more detailed look at retail sales adjusted both for inflation and population growth.

Bottom Line: The Advance Core retail sales came in weaker than expected, but it will be subject to revision for the next two months.

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