Retail Sales: Increases Modestly in January

Bottom Line: Total retail spending rose in January, more than expectations. Core retail sales also increased and were led by gains in nonstore retailers and general merchandise stores. Both overall and core retail sales are now increasing modestly on a year over year basis. Core Sales ex-gasoline stations and ex-building materials during January were modestly above their Q4 averages, suggesting that real consumer spending will add positively to Q1 GDP. Retail Sales ROSE by 0.2% in January, compared with the market consensus for an increase of 0.1%. The December estimate was revised higher from -0.1% to 0.2%. Retail sales are now 3.4% ABOVE their year ago level; just a year ago, the year over year growth rate was 3.9%. Spending at motor vehicle dealers climbed by 0.6%. Core Retail Sales ROSE by 0.1%, compared with the market consensus for no change. The December estimate was revised higher from -0.1% to 0.1%. Core retail sales are now 2.5% ABOVE their year ago level; just a year ago, the year over year growth rate was 1.8%. In January, gains at nonstore retailers (+1.6%), general merchandise stores (+0.8%), grocery stores (+0.5%), building materials (+0.6%), miscellaneous retailers (+1.2%), clothing stores (+0.2%) and electronic and appliance stores (+0.1%) were partially offset by declines in gasoline stations, primarily due to low gasoline prices (-3.1%), sporting goods, hobbies, etc. (-2.1%), furniture & home furnishing (-0.5%) and health and personal care (0.0%). Core Retail Sales ex Gasoline ROSE by 0.4% and are now 3.8% ABOVE their year ago level; just a year ago, the year over year growth rate was a solid 5.8%.