Thursday, 13 March 2008

US Retail Sales Retreat in February



The U.S. Census Bureau announced today that advance estimates of U.S. retail and food services sales for February, adjusted for seasonal variation and holiday and trading-day differences, but not for price changes, were $380.2 billion, a decrease of 0.6 percent (±0.5%) from the previous month, but 2.6 percent (±0.7%) above February 2007. Total sales for the December 2007 through February 2008 period were up 3.3 percent (±0.5%) from the same period a year ago. The December 2007 to January 2008 percent change was revised from +0.3 percent (±0.5%)* to +0.4 percent (±0.2%).

Retail trade sales were down 0.6 percent (±0.7%)* from January 2008, but were 2.4 percent (±0.8%) above last year. Gasoline station sales were up 20.2 percent (±1.0%) from February 2007 and sales of sporting goods, hobby, book, and music stores were up 6.3 percent (±2.8%) from last year.

As mentioned last month the unexpected rise in auto sales was not a sustainable trend, auto sales falling -2.0% in February. Downward revisions to total sales were also made to January, -0.1% and December -0.2%. Revisions to December sales now total -0.6% after revsions in January.

As mentioned last month revisions to prior months are a normal part of the process, however it is the trend of those revisions that is important and at the moment that trend is showing signs of weakness. November was revised down twice, so too now December and the first revision to January was also down.

With the rising costs of inflation, higher mortgage costs and the HELOC ATM now removed from homeowners front lawns, it's no wonder consumers are feeling tapped out, and with the continued deterioration in home prices and a weakening labor market it's doubtful the consumers fortunes will turn around anytime soon.