Retail Sales Numbers Jarring, Perplexing
A surprise retail sales report showing a bigger-than-expected drop in most categories is a reason to pay attention – but it’s hard to draw any meaningful conclusions from a single report, however jarring.
That’s because there’s a lot of data showing the economy is still strong, said Bob Hughes, senior research fellow at the American Institute for Economic Research. Recent reports have showed the labor market is improving, even if hourly wages declined slightly.
The Commerce Department reported on Wednesday morning that retail sales fell 0.9 percent from November to December, and the two previous months were revised downward. Of the major categories, only restaurants, drug stores and grocery stores saw increases in December.
It was a very weak report, but “until we get confirmation from other sources, it’s hard to tell if this report was an outlier or the start of a new, more ominous trend,” Hughes said.
“We’re still adding jobs, consumer confidence is still good. It’s one of those reports that probably is an anomaly, but you don’t want to dismiss it as such too casually,” Hughes said.