skip navigation

By the Numbers

Featuring brief segments of economic analysis from our senior economist Michael Bazdarich, PhD.

The economic analysis we previously featured in By the Numbers is now available on the Western Asset Blog. This page will no longer be updated.

November Retail Sales Get Xmas Season Off to a Rollicking Start

November retail sales registered strong gains in data released this morning, with headline retail sales rising by 0.8% above an October level that was revised upward by 0.2%. Our “control” sales measure, tallying sales excluding vehicles, gasoline, and building materials, was also up by 0.8% with 0.2% upward revisions to October.

As shown in the accompanying chart, the November news was the strongest retail sales performance in quite some time and was enough to single-handedly boost the six-month growth rate for sales from last month’s 3.4% rate to 4.7% this month.

Sales were up nicely at virtually every type of store. The only sectors not showing strong gains were car dealers, grocery stores, and department stores, and even there, car dealers and grocery stores were coming off of elevated sales levels for October. In other words, it is hard to find a clunker in today’s news.

Needless to say, the November retail gains—and October revisions—were much stronger than we had been expecting. Retail sales growth had been decent but steady for the last few years, even while consumer spending on services (not covered by retail sales) looked to have slowed over the last six months. The November sales, of course, marked the first month of the Christmas season, and seasonal vagaries could easily have temporarily boosted sales growth in November. For now, however, such thoughts are definitely Scrooge-like. One can’t argue with the facts of what is clearly a strong report.

Right now, we are seeing forecasts for 4Q17 GDP all over the place. At last report, the New York Fed model was looking for 3.9% 4Q17 growth, while the Atlanta Fed was at 2.5%, joined there by a couple of Wall Street banks. Our own model was registering something like 1.5% growth, thanks to October news that showed big reverses in both the trade balance and inventories. The November sales news will boost all projections, but we would expect the guesstimates to congeal around a low 2% type number in the weeks to come.

Retail Sales Trends
Retail Sales Trends
Source: Census Bureau, as of 30 Nov 17. “Control” retail sales is total sales less vehicle dealers, service stations and building materials stores.

Michael Bazdarich

Product Specialist/Economist

Mike brings more than 45 years of experience to his position. "By the Numbers" will address economic data releases that are pertinent to a broad range of investors.

Prior to joining the Firm in 2005, Mike ran his own consulting firm, MB Economics. He earned his PhD in Economics at the University of Chicago.

Sign up to receive email updates as new reports are released.

© Western Asset Management Company, LLC 2022. This publication is the property of Western Asset and is intended for the sole use of its clients, consultants, and other intended recipients. It should not be forwarded to any other person. Contents herein should be treated as confidential and proprietary information. This material may not be reproduced or used in any form or medium without express written permission.
Past results are not indicative of future investment results. This publication is for informational purposes only and reflects the current opinions of Western Asset. Information contained herein is believed to be accurate, but cannot be guaranteed. Opinions represented are not intended as an offer or solicitation with respect to the purchase or sale of any security and are subject to change without notice. Statements in this material should not be considered investment advice. Employees and/or clients of Western Asset may have a position in the securities mentioned. This publication has been prepared without taking into account your objectives, financial situation or needs. Before acting on this information, you should consider its appropriateness having regard to your objectives, financial situation or needs. It is your responsibility to be aware of and observe the applicable laws and regulations of your country of residence.
Western Asset Management Company Distribuidora de Títulos e Valores Mobiliários Limitada is authorized and regulated by Comissão de Valores Mobiliários and Brazilian Central Bank. Western Asset Management Company Pty Ltd ABN 41 117 767 923 is the holder of the Australian Financial Services Licence 303160. Western Asset Management Company Pte. Ltd. Co. Reg. No. 200007692R is a holder of a Capital Markets Services Licence for fund management and regulated by the Monetary Authority of Singapore. Western Asset Management Company Ltd is a registered Financial Instruments Business Operator and regulated by the Financial Services Agency of Japan. Western Asset Management Company Limited is authorised and regulated by the Financial Conduct Authority (“FCA”) (FRN 145930). This communication is intended for distribution to Professional Clients only if deemed to be a financial promotion in the UK as defined by the FCA. This communication may also be intended for certain EEA countries where Western Asset has been granted permission to do so. For the current list of the approved EEA countries please contact Western Asset at +44 (0)20 7422 3000.