Retail Sales: Strong Rebound in January

Bottom Line:  Retail sales rose sharply in January, more than making up for weakness in December, which was revised to show even larger declines than previously reported.  Many of the weakest categories in December saw stronger rebounds in January. Electronics retailers, for instance, saw a nearly 15% jump in sales after a slide of 6.5% in December.   Nonstore retailers (internet) saw a similar rebound.  While some of the volatility in December to January volatility is difficult seasonal adjustments given how the pandemic changed holiday shopping trends, the overall rebound was substantial and showed consumers were willing to spend again as shutdowns were lifted, vaccine rollouts continued and another stimulus plan looked likely.  Looking through the volatility, this was a strong report, and the first quarter growth started with a stronger than expected push from the consumer.Retail Sales ROSE by 5.3% in January,  compared with the market consensus for an increase of 1.1%.   The December estimate was revised lower from -0.68% to -1.02%. Retail sales are now 7.4% ABOVE their year-ago level; just a year ago, the year-over-year growth rate was 4.7%. Spending at motor vehicle dealers climbed by 3.1%.
 
Core Retail Sales ROSE by 5.9%, compared with the market consensus for an increase 1.0%. The December estimate was revised lower from -1.40% to -1.80%. Core retail sales are now 6.1% ABOVE their year-ago level; just a year ago, the year-over-year growth rate was 4.4%.In January, gains at nonstore retailers (+11.0%), general merchandise stores (+5.5%), building materials (+4.6%), and grocery stores (+2.4%) led the overall rebound.

Core Retail Sales ex Gasoline ROSE by 6.06% and are now 7.6% ABOVE their year-ago level; just a year ago, the year over year growth rate was a moderate 3.8%.