November retail strength: Control group signals firm underlying demand
|Summary
November retail sales rose 0.6%, and despite some downward revisions to prior data, we see consumer spending momentum carrying into Q4. That said, watch out for a comparatively soft December as previewed in both our Holiday Sales outlook and in high frequency data.
Source: U.S. Department of Commerce and Wells Fargo Economics
Holiday spending was in full swing in November
Retail sales rose 0.6% in November, following a flat reading in October. A rebound in auto sales helped, but not as much as expected. Even after excluding autos, sales still rose 0.5%.
The control group series removes sales at auto dealers, gasoline, building materials, and food services stores. These categories are removed because they are driven heavily by price swings, seasonality, or factors not reflective of consumer fundamentals (e.g., construction activity, energy prices, vehicle incentives). What’s left are the retail categories that give the best signal of underlying core goods consumption and that measure rose 0.4% in November after a downward revision put the October increase in control group at 0.6%. The upshot is a still-resilient consumer coming into the homestretch with plenty of momentum.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.