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US Retail Sales: Persistent Weakness to Close 2020 – Nord LB Column

In the United States, current (and preliminary) figures on the development of retail sales were published a few minutes ago. After the pronounced weakness in the previous month, hardly any better data could be reported in December at the end of a year that was not only economically very difficult. In numbers, the rate of change was a disappointing -0.7% m / m. The annual rate based on the seasonally unadjusted time series is now at + 4.8%, but of course a negative surprise must be spoken of.

Obviously, the coronavirus crisis continues to weigh on demand from US consumers. In the restaurants, sales have actually collapsed at the current edge. This subgroup showed a rate of change of -4.5% m / m after weak figures in the previous month. Excluding the catering industry, retail sales fell “only” by 0.3% m / m in December. In addition, there was currently no compensation through higher sales figures in the food and beverages category. A slowdown of 1.4% m / m was reported for December. However, this development is primarily to be understood as a countermovement after the strong figures in the previous month. Obviously, many US households topped up their food reserves back in November.

A look at the details of the current data also shows that the US car dealerships were now able to generate significantly more sales again after the sales slump in the previous month. For this important sub-component, an increase of at least 1.9% m / m was reported in December. This is a positive surprise.

In the case of the two sub-components, furniture and building materials, which are closely linked to the US real estate market, there are again contradicting tendencies. While furniture sales decreased by 0.6%, the building materials segment is again presenting itself in a friendly manner. There was an increase of 0.9% w / w. This could be seen as a new indication that the US real estate market will continue to do well.

Sales at the US gas stations rose significantly in December by 6.6% m / m. The fact that the WTI oil price stabilized over the psychologically important mark of USD 40 per barrel in December could play a role in explaining this movement. M.

The retail sales control group gave way at the current edge. A rate of change of -1.9% M / M was reported for this time series in December, which is clearly to be assessed as a negative surprise.

Conclusion: In the reporting month of December, too, US consumers showed marked reluctance. In 2021, better numbers on the development of retail sales in the land of opportunity will certainly be on the news ticker again. However, the end of 2020 can clearly be described as unpleasant. Many forecasters seem to have recently thought about raising their US growth forecasts for the fourth quarter of 2020; With the current information on the control group, however, only chronic black painters can now be under the pressure to act!

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