Retail Sales

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Definition:
An estimate of the total sales of goods by all retail establishments in the U.S. (Sales of services are not included) for month prior to the release of the report. Data are presented in nominal, or current, dollars, meaning they are not adjusted for inflation. However, the data are adjusted for seasonal, holiday, and trading-day differences between the months of the year.


Contents

Background

The report is generated from the receipts provided by participating randomly-sampled retailers. The report is expressed both in millions of dollars and as a percentage change from previous months, and data is broken down into a wide variety of retailer categories. Sales are categorized by type of establishment, not by type of good. Additionally, the report is usually made available with automotive sales excluded from estimates of total spending, since automotive sales vary widely from month to month and tend to skew data.

The use of the Retail Sales report in trading is clear, since the report provides extremely specific data about which industries and commodities consumers are spending most of their money on. However, one major drawback of the report is that it only reflects sale prices without taking into account inflation within the prices of certain volatile industries (gas and other energies in particular.) The report also doesn't provide any data on service industry sales, making the Personal Income and Spending report more useful in this area. Still, traders consider the Retail Sales report one of the most generally useful of the economic indicators, with a wide range of applications for various asset markets.

Importance

Personal consumption expenditures (PCE) represent roughly two-thirds of GDP. By monitoring retail sales, policy makers are able to make an assessment of the likely growth of PCE for the current and future quarters.

Source

U.S. Department of Commerce, Bureau of the Census

Frequency

Monthly

Availability

Advance estimate released during the second week of the month for the immediately preceding month.

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