 | Retail Sales Declined 1.1% in November |
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| Posted Under: Data Watch • Retail Sales • COVID-19 |
Implications: As we have been seeing in the high frequency data, the shutdowns are starting to impact economic data again with consumers getting more conservative waiting for another stimulus package to arrive. Retail sales declined 1.1% in November, lagging the consensus expected drop of 0.3%. Only three of the thirteen major categories rose in November, with the same areas being hit that were hit the last time shutdowns started to take hold earlier this year. Novembers data showed Restaurants & bars fell 4.0% for the month, while auto sales declined 1.7%, and clothing & accessory stores fell 6.8%, all the largest declines since April. At the same time, grocery store sales rose 1.9% as consumers look to be stockpiling again, while non-store retailers (internet and mail-order sales) grew 0.2%. Expect further gains in the months to come for non-store retailers as states continue restrictions as COVID-19 cases continue to rise. We do not expect a massive decline in retail sales like we saw back earlier this year. Both companies and consumers have adapted, and even with further restrictions, things will not be even remotely close to as bad as they were in the early part of the year. It's important to keep in mind how much progress has been made since then. Back in April, retail sales were down 19.9% from a year ago; now, even with the decline in October and November, retail sales are up 4.1% from November 2019. For some more perspective: from February (before the COVID shutdowns started) to the bottom in April, retail sales fell 21.7%. Now, even with the decline in November, we are 3.6% higher than the February pre-COVID high-water mark, meaning retail sales have had a full V-shaped recovery. "Core" sales, which exclude the most volatile categories of autos, building materials, and gas station sales, declined 1.0% in November, but are still up 4.7% from a year ago.
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