Home   Logon   Mobile Site   Research and Commentary   About Us   Call 1.800.621.1675 or Email Us       Follow Us: 

Search by Ticker, Keyword or CUSIP       
 
 

Blog Home
   Brian Wesbury
Chief Economist
 
Click for Bio
Follow Brian on Twitter Follow Brian on LinkedIn View Videos on YouTube
   Bob Stein
Deputy Chief Economist
Click for Bio
Follow Bob on Twitter Follow Bob on LinkedIn View Videos on YouTube
 
  Retail Sales Rose 3.8% in January
Posted Under: CPI • Data Watch • Government • Inflation • Retail Sales • Trade • Spending • COVID-19
Supporting Image for Blog Post

 
Implications:  Retail sales boomed in January, easily beating consensus expectations, and rising 3.8% for the month, the fastest gain since March 2021.  Some of the gain was due to inflation, but most of it was not: consumer prices rose 0.6% in January, leaving "real" retail sales up 3.1% for the month because of rounding.  The sales gains were broad, with eight of thirteen major categories up in January, led by non-store retailers and autos, in particular, with large gains also among general merchandise stores and in building materials.  Overall sales are up a robust 13.0% from a year ago.  Another way to look at it is that sales are up 23.6% versus February 2020, which was pre-COVID.  "Core" sales, which exclude the most volatile categories of autos, building materials, and gas station sales, also rose 3.8% in January, are up 11.5% from a year ago, and up 21.3% versus February 2020.  In other words, due to a very loose monetary policy and the massive increase in government transfer payments in response to COVID, retail sales are running much hotter than they would have had COVID never happened, even as the level of output (real GDP) is still running lower than it would have been in the absence of COVID.  It has not been an even recovery for all major categories, though.  While categories like online shopping, sporting goods stores, and gas stations have had above-trend growth since COVID began, others, like restaurants & bars, weren't back to pre-COVID levels until April of 2021.  In the months ahead, the path of retail sales will be a battle between a number of opposing factors.  Rising wages, jobs, and inflation will all be tailwinds for retail sales, while the waning of the temporary and artificial boost from "stimulus" checks and other government benefits will be headwinds.  In other news this morning, import prices rose 2.0% in January while export prices increased 2.9%.  In the past year, import prices are up 10.8%, while export prices are up 15.1%.  Expect prices to move higher in the months ahead as Omicron wanes and monetary policy – both here and abroad – remains overly loose.

Click here for a PDF version
Posted on Wednesday, February 16, 2022 @ 11:28 AM • Post Link Share: 
Print this post Printer Friendly

These posts were prepared by First Trust Advisors L.P., and reflect the current opinion of the authors. They are based upon sources and data believed to be accurate and reliable. Opinions and forward looking statements expressed are subject to change without notice. This information does not constitute a solicitation or an offer to buy or sell any security.
 
The information presented is not intended to constitute an investment recommendation for, or advice to, any specific person. By providing this information, First Trust is not undertaking to give advice in any fiduciary capacity within the meaning of ERISA, the Internal Revenue Code or any other regulatory framework. Financial professionals are responsible for evaluating investment risks independently and for exercising independent judgment in determining whether investments are appropriate for their clients.
First Trust Portfolios L.P.  Member SIPC and FINRA. (Form CRS)   •  First Trust Advisors L.P. (Form CRS)
Home |  Important Legal Information |  Privacy Policy |  California Privacy Policy |  Business Continuity Plan |  FINRA BrokerCheck
Copyright © 2022 All rights reserved.