Review of March 2024 data, 1Q GDP, PCE and personal income

The monthly summary is not so wonderful, incomparison...

Inside all that pink is some troubling food related issues. Even though energy is somewhat in a narrow band, the food outlook is upward. The CPI-U expectations for the report on April, seemingly indicates a repeat of Mar-2024, outpacing the monthly core, although core is expected to ease a bit. Still above the overall CPI-U.

As for the personal income arena... this is the link... https://www.bea.gov/news/2024/personal-income-and-outlays-march-2024

There seems to be quite a jump in spending, versus Disposable personal income... for 2 consecutive months. Not sure there was much cash on hand, so the disposable is likely in the form of additional debt. 

Of course the above report mentioned a rise in goods. Perhaps it did, but the 1Q GDP did not reflect that. 

As for GDP, it now stands at 1.6% annualized for 1Q2024. The Trade deficit loomed large in the quarter and shows no signs of abating.

The reports for the month, ended up in so-so territory, imho. I am sure it will get spun hard in each direction. 

4/15/2024, Advance Retail Sales Report for March Data

Advance Monthly Sales for Retail and Food Services, March Report.

Advance estimates of U.S. retail and food services sales for March 2024, adjusted for seasonal variation and holiday and trading-day differences, but not for price changes, were $709.6 billion, up 0.7 percent (±0.5 percent) from the previous month, and up 4.0 percent (±0.5 percent) above March 2023. Total sales for the January 2024 through March 2024 period were up 2.1 percent (±0.5 percent) from the same period a year ago. The January 2024 to February 2024 percent change was revised from up 0.6 percent (±0.5 percent) to up 0.9 percent (±0.2 percent).

Retail trade sales were up 0.8 percent (±0.5 percent) from February 2024, and up 3.6 percent (±0.5 percent) above last year. Nonstore retailers were up 11.3 percent (±1.6 percent) from last year, while food services and drinking places were up 6.5 percent (±2.1 percent) from March 2023.

The previous two months were revised upward. Here is the revision history...

The inflation adjusted retail sales...

Taking a look at retail sales (current dollars), with inflation adjusted (real dollars Feb. 2020).

The orange dots is the inflation adjusted, the line has been consistently just below the 600,000 mark (in millions)

Another comparison would be inflation adjusted as well.

Sales when adjusted for inflation, has remained relatively flat, after the recovery from covid, and vaccine rollout, plus stimulus. The timing for this, coupled with major issues in container transportation... resulted in the transitory phase of inflation.

Quite a good argument can be made the "transitory" inflation was exported, due to ocean going shipping problems. Of course, by mid to late 2021, energy became a predominant factor, followed by the Russian invasion of Ukraine and subsequent energy issues. By that time, inflation became everywhere.

This month's report was pretty darn stellar, given the upward revisions of the previous two months. The standout was electronic shopping and mail order houses, which account for 17.3% of the total, but was a 45.4% of the overall annual gains, with the monthly rise being 64.7% of the total monthly gain.

There are problem areas, however. 

But we can take a good report, without muddying up the picture. At least in my humble opinion.

Review of February 2024 data, 4Q GDP Revision, PCE and personal income

The monthly summary...

The overall PCE edged upward, on annual basis, with PCE ex food and energy staying flat. 

Of course, the official got revised up for January, which indicates a difference from my report...

As for the personal income arena... this is the link... https://www.bea.gov/news/2024/personal-income-and-outlays-february-2024

Note the revisions as always, and I would recommend tracking the data monthly. Revisions are normal part of the cycle, as more data comes in. Recently however... previous data seems to come in a tad lower, which results in inflated current estimates. This was not always the case.

As for GDP, it seems to have edged up for 2023-4Q. I am not going to beat that horse over trade deficit numbers. I will simply state that prior to transfer of data from 2012 dollars into 2017 dollars, the GDP was marginally better. That adjustment amounts to about 1.9% annualized. So just take that with a grain of salt, as it is just my opinion.

One remaining bit of info can be found here. While I might harangue about the national debt, the 2023 year end net international investment was released. UGLY, at almost $20T. THAT IS WHAT WE OWE OTHER COUNTRIES.

https://fred.stlouisfed.org/series/IIPUSNETIQ

3/14/2024, Advance Retail Sales Report for February Data

Advance Monthly Sales for Retail and Food Services, February Report.

Advance estimates of U.S. retail and food services sales for February 2024, adjusted for seasonal variation and holiday and trading-day differences, but not for price changes, were $700.7 billion, up 0.6 percent (±0.5 percent) from the previous month, and up 1.5 percent (±0.7 percent) above February 2023. Total sales for the December 2023 through February 2024 period were up 2.1 percent (±0.5 percent) from the same period a year ago. The December 2023 to January 2024 percent change was revised from down 0.8 percent (±0.5 percent) to down 1.1 percent (±0.4 percent).

Of course the previous 2 months were revised downward...

The result in inflation adjusted sales, looked like this...

Since the pre-covid timing, the inflation report...

The average for the monthly sales starting from March 2021...

The trend is undeniably downward. 

It's not all gloom and doom, as there are areas seemingly on the uptick. Read the report and download the data, to see those areas.

 

Review of January 2024 data, 4Q GDP Revision, PCE and personal income

The monthly summary...

The downward shift in inflation continues across the board, with the exception of my price index, which is more about healthcare than any other weightings.

There were modest revisions in the PCE report, which are highlighted in Red.

I have made much of government spending on the GDP, but historically... not so abnormal (all charts from 2000Q1 onward...

A bit grainy in the upload, but trends are evident. The worrying factor is the trade deficit, while showing a bit of improvement the past few months, is still staggering compared to 10 years ago.

Bored silly, so will leave it there. 

2/15/2024, Advance Retail Sales Report for January Data

Advance Monthly Sales for Retail and Food Services, January Report.

Advance estimates of U.S. retail and food services sales for January 2024, adjusted for seasonal variation and holiday and trading-day differences, but not for price changes, were $700.3 billion, down 0.8 percent (±0.5 percent) from the previous month, and up 0.6 percent (±0.7 percent)* above January 2023. Total sales for the November 2023 through January 2024 period were up 3.1 percent (±0.5 percent) from the same period a year ago. The November 2023 to December 2023 percent change was revised from up 0.6 percent (±0.5 percent) to up 0.4 percent (±0.3 percent).

Cutting through the malarkey...

After revising the November numbers down by -0.4%, and December numbers downward by -1.4%, we still end up with January sales down by -0.8%, from December.  With inflation for the past 12 months at 3.1%, sales were only up +0.6%.

Granted the graph above, is a bit busy, but the retail sales, adjusted for inflation appear to be flat.

Looking at the average monthly sales (adjusted for inflation) since March, 2021... is provided in this graph.

Even better is this inflation adjusted graph starting in February, 2020.

Once past the initial vaccine rollout, coupled with massive stimulus checks, it quickly petered out, then rising into early 2022, then early 2023 saw a slow and steady decline.

As for the data in the report, there was a striking difference between adjusted and unadjusted numbers.

The unadjusted numbers were across the board for monthly sales, with adjusted showing only a very few instances of sales increases... with neither being inflation adjusted. 

When checking individual categories for adjusted numbers, and factoring inflation... only 3 indicated any improvement. 

• Furniture and home furnishings
• Grocery stores (just barely)
• Food services and drinking places.

No doubt next month's report will be stellar, once all the downward revision from previous months take place. (LOL!)

Review of December 2023 data, 4Q GDP, PCE and personal income

Alas, 2023 reports have concluded. The GDP's 4Q advance reading indicates a sterling 3.1% rise. I will make mention of the 5 year Quinquennial revision from 2012 dollars to 2017 dollars. As would be expected the numbers jumped 9.0%. I can't help but notice the big drag on GDP of net exports of good and services, slid a whopping -26.7%. 

Even under the revised numbers, that latter component fell another -5.9% from one year ago.

PCE, which is typically 68.7% of GDP under the 2017 revision, made up 58.3% of that yearly increase. 

Which gives pause to the notion of the consumer driving those GDP numbers, when in fact they appear to have been a bit of drag.

Gross private investment, also underperformed. The real over achievers were government and net exports of good and services. 

It is what it is.

PCE ex. food and energy ease from 3.4% to 3.2%. The overall remained unchanged.

All in all, a decent end to the 2023 years.

1/17/2024, Advance Retail Sales Report for December Data

Advance Monthly Sales for Retail and Food Services, December Report.

Advance estimates of U.S. retail and food services sales for December 2023, adjusted for seasonal variation and holiday and trading-day differences, but not for price changes, were $709.9 billion, up 0.6 percent (±0.5 percent) from the previous month, and up 5.6 percent (±0.7 percent) above December 2022. Total sales for the 12 months of 2023 were up 3.2 percent (±0.4 percent) from 2022. Total sales for the October 2023 through December 2023 period were up 3.9 percent (±0.4 percent) from the same period a year ago. The October 2023 to November 2023 percent change was unrevised from up 0.3 percent (±0.3 percent)*.

Hmmm...  "Total sales for the 12 months of 2023 were up 3.2 percent (±0.4 percent) from 2022." The BLS listed that same period as having inflation of 3.4%. Which means the seasonal variation and trading-day differences have come into the equation. Otherwise, sales were up a bit more than indicated, imho.

First up the revisions...

We continue a pattern of previous months being revised downward, so the monthly changes are somewhat suspect.

When adjusted for inflation, the annual shows an improvement of +2.2%. The January numbers will be quite interesting, imho. The January report, adjusted for inflation, is slightly above the December number with inflation adjustements. Revisions will likely take place. 😒

The inflation adjusted chart looks like this...

The quantity of goods has not yet matched the highs of both March and April of 2021 and 2022. It will be interesting to see if a seasonal repeat is in store for early spring.

Mail order, vehicles and general merchandise led the way, with $4.305M of the $3.909M increase. That means there were some losers. Gasoline was down -$691M. The rest were slightly above or slightly below.

Seasonal factors likely drove the mail order and general merchandise, so can't reasonably expect a repeat in January. Gasoline currently remains relatively flat, compared to December.

Like I said... the revisions for January's report should be very interesting.

Review of November 2023 data, GDP, PCE and personal income

 I'll try not to harp about this too much. The BEA switched from 2012 dollars to 2017 dollars for 3Q23, and adjusted prior data. I download all such reports, so I can easily tell the difference.

The trade deficit is a drag on GDP, thus in the 2Q23 original report, that drag was -5.95%. As of right now, after those adjustments... the drag is-4.14%. Quite an improvement. The stated +4.9% GDP is a catch up to what can only be viewed as under-reporting of previous quarters. 

How that change affects going forward, is uncertain to me. Given the wide array of expectations for 4Q23, I am thinking not everyone is on the same page. I am done harping about this.

Now on to the PCE report, after reviewing adjustments...

Yes, inflation is slowing, not deflating, with the exception of gasoline, which looks to have stopped falling.

The monthly summary...

All in all, a pretty good monthly report card. I do think the market is making too big a deal on expectations of the FED cutting rates before summer, but what do I know?

12-15-23, Advance Retail Sales Report for November Data

Advance Monthly Sales for Retail and Food Services, November Report.

First up should be the revisions...

Note the -0.2% downward revision in October's numbers and as always, remember this data is NOT inflation adjusted. Now onto the current report...

Advance estimates of U.S. retail and food services sales for November 2023, adjusted for seasonal variation and holiday and trading-day differences, but not for price changes, were $705.7 billion, up 0.3 percent (±0.5 percent)* from the previous month, and up 4.1 percent (±0.7 percent) above November 2022.

The inflation adjusted chart looks like this...

It is hard to capture from the graph, but "Real" sales are advancing very slowly since January, although still below 2022 average levels. Year over year, up +0.8% inflation adjusted, with the month being up +0.5% after inflation adjustements. 

So it can be called a win.

10-17-23, Advance Retail Sales Report for September Data

Advance Monthly Sales for Retail and Food Services, September 2023. 

Advance estimates of U.S. retail and food services sales for September 2023, adjusted for seasonal variation and holiday and trading-day differences, but not for price changes, were $704.9 billion, up 0.7 percent (±0.5 percent) from the previous month, and up 3.8 percent (±0.7 percent) above September 2022. Total sales for the July 2023 through September 2023 period were up 3.1 percent (±0.4 percent) from the same period a year ago. The July 2023 to August 2023 percent change was revised from up 0.6 percent (±0.5 percent) to up 0.8 percent (±0.1 percent).

Retail trade sales were up 0.7 percent (±0.5 percent) from August 2023, and up 3.0 percent (±0.5 percent) above last year. Nonstore retailers were up 8.4 percent (±1.6 percent) from last year, while food services and drinking places were up 9.2 percent (±2.3 percent) from September 2022.

As always, a reminder... "not for price changes", means not adjusted for inflation.

The term "resilient" continues to be overused, when clearly the actual "stuff" being bought is rather stagnant. 

That's not to say that last month's data was not an improvement, as both month to month and year over year were up... after adjusting for inflation. However, a rolling 12 month average indicates slippage of -0.1%, when adjusted for inflation.

That includes last September, which got revised downward... ever so slightly.

It should be noted, that today's report is +1.8% above January in current dollars, yet -1.1% when inflation adjusted. THAT is after all the revisions to January. Which begs the question... what will next month's backward revisions be.

You won't hear about it, as the mantra... "if it can't be spinned positively, ignore it." I am not saying the Census Bureau minions are at work here, but politicians and their friendly media darlings do.

I will continue to monitor thee monthly reports, however this is the last in this series.

9-14-23, Advance Retail Sales Report for August Data

Advance Monthly Sales for Retail and Food Services, August 2023. 

Advance estimates of U.S. retail and food services sales for August 2023, adjusted for seasonal variation and holiday and trading-day differences, but not for price changes, were $697.6 billion, up 0.6 percent (±0.5 percent) from the previous month, and up 2.5 percent (±0.7 percent) above August 2022. Total sales for the June 2023 through August 2023 period were up 2.2 percent (±0.4 percent) from the same period a year ago. The June 2023 to July 2023 percent change was revised from up 0.7 percent (±0.5 percent) to up 0.5 percent (±0.2 percent).

Retail trade sales were up 0.6 percent (±0.5 percent) from July 2023, and up 1.6 percent (±0.5 percent) above last year. Gasoline stations were down 10.3 percent (±1.1 percent) from last year, while food services and drinking places were up 8.5 percent (±2.3 percent) from August 2022.

Again... "not for price changes", means not adjusted for inflation.

Much is being made of "gasoline's" impact, but the numbers, when adjusted for inflation continue to remain rather stagnant, with adjusted spending remaining rather flat since the roll out of the vaccines and that $1,400 stimulus in spring 2021. Which also coincides with the ramp up of inflation.

Last month, my mood was elevated, as previous month's data had been revised upward, after so many months of downward revisions. 

We seem to be at it again. Can I expect this month's numbers to be revised downward... next month? Revising a previous month downward, then claiming +0.6% increase, while then stating it is mostly gasoline, is befuddling to me. 

Somehow, I expect the cycle to continue, without anyone questioning those banner numbers. 

8-15-23, Advance Retail Sales Report for July

Advance Monthly Sales for Retail and Food Services, July 2023. 

Advance estimates of U.S. retail and food services sales for July 2023, adjusted for seasonal variation and holiday and trading-day differences, but not for price changes, were $696.4 billion, up 0.7 percent (±0.5 percent) from the previous month, and up 3.2 percent (±0.7 percent) above July 2022. Total sales for the May 2023 through July 2023 period were up 2.3 percent (±0.4 percent) from the same period a year ago. The May 2023 to June 2023 percent change was revised from up 0.2 percent (±0.5 percent)* to up 0.3 percent (±0.2 percent).

Retail trade sales were up 0.6 percent (±0.5 percent) from June 2023, and up 2.0 percent (±0.5 percent) above last year. Nonstore retailers were up 10.3 percent (±1.6 percent) from last year, while food services and drinking places were up 11.9 percent (±2.3 percent) from July 2022.

The "but not for price changes, means not adjusted for inflation... 

While improved over last month by 0.5% when adjusted for inflation... year to year is flat.

In a previous column, I made mention of the Census Bureau's propensity to revise downward previous month's data to improve current month results. We are in the second month of previous month's data being revised upward... which is good news. May that become a trend going forward.

Non store retailers, continues to lead the pack, with Furniture and Electronics turning negative from last month. Clothing edged up from last month, with Food Services and drinking places accelerating.

What really stands out is the EX gasoline category, which rose 5.8% year over year, which is better than the CPI EX gasoline of 4.3%.

Room for optimism!

7-18-23, Advance Retail Sales Report for June

Advance Monthly Sales for Retail and Food Services, June 2023. 

Advance estimates of U.S. retail and food services sales for June 2023, adjusted for seasonal variation and holiday and trading-day differences, but not for price changes, were $689.5 billion, up 0.2 percent (±0.5 percent)* from the previous month, and up 1.5 percent (±0.7 percent) above June 2022. Total sales for the April 2023 through June 2023 period were up 1.6 percent (±0.4 percent) from the same period a year ago. The April 2023 to May 2023 percent change was revised from up 0.3 percent (±0.5 percent)* to up 0.5 percent (±0.2 percent).

Retail trade sales were up 0.2 percent (±0.5 percent)* from May 2023, and up 0.5 percent (±0.5 percent)* above last year. Nonstore retailers were up 9.4 percent (±1.6 percent) from last year, while food services and drinking places were up 8.4 percent (±2.3 percent) from June 2022.

Those figures are nominal, meaning not adjusted for inflation. Compare the nominal 0.2% monthly and 1.5% annual increase... to the CPI of 0.2% monthly and 3.0% annual. In other word, the montly was flat in inflation adjusted and -1.5% on the annual inflation adjusted.

Now for the good news... maybe.

After months of the media extolling the upward trend meeting or exceeding expectations of the Advance report, they are ho-hum to disappointed in this report.

For months, I have lamented the constant downward revisions of preceding months, which gives the appearance of meeting or exceeding expectations on the Advance Report.

However, this month's advance report shows an upward revision to both April and May... from last month. Without the upward in revision in May's numbers, the uptick would have been about +0.43%. Which is still below the expectations, but not as far below the +0.5% expected.

What does appear to be happening... is the consumer is running out of steam, and has been since January. Even the FED has picked up on this. The Census Bureau acknowledges this with their XLS download (table 2). 

Now the winners and losers...

Nonstore retailers is generally the mail order places, such as Amazon, etc. Furniture and electronics popped up as well as clothing. 

Building materials, gasoline stations, sporting goods, and surprisingly... grocery stores slid.

As stated earlier, the spending habits are simply shifting from one thing to another, with no real growth... except inflation generated.

This graph is from data taken from the St. Louis Federal Reserve (FRED) website...

Seriously, the data from every source... indicates the party is pretty much over. It will be hard to put any type of positive spin... going forward. 

Spin has been most of the business news for over a year. The realization of this condition will lead to claims of gloom and doom... which is also spin. 

The past two years have not been nirvana and the outlook going forward is not bleak. At some point the spin will moderate to reality, imho.

6-15-23, Advance Retail Sales Report for May

Advance Monthly Sales for Retail and Food Services, May 2023.

Advance estimates of U.S. retail and food services sales for May 2023, adjusted for seasonal variation and holiday and trading-day differences, but not for price changes, were $686.6 billion, up 0.3 percent (±0.5 percent)* from the previous month, and up 1.6 percent (±0.7 percent) above May 2022. Total sales for the March 2023 through May 2023 period were up 1.7 percent (±0.4 percent) from the same period a year ago. The March 2023 to April 2023 percent change was unrevised at 0.4 percent (±0.2 percent).

The advance estimate are in current dollars, and are not adjusted for inflation. The CPI for May was 4.0% Y/Y, while the advance sales estimates were up 1.6% (± 0.7%). Effectively paying more for less. 

Retail trade sales were up 0.3 percent (±0.5 percent)* from April 2023, and up 0.7 percent (±0.5 percent) above last year. Nonstore retailers were up 6.5 percent (±1.4 percent) from last year, while food services and drinking places were up 8.0 percent (±2.3 percent) from May 2022.

Time for the revisions...

I do not fault the bean counters, as it is openly acknowledged that estimates are based on incomplete information. The problem is with the media, that jump to conclusions based on incomplete information.

In short, the sales numbers are rather stagnant, when factoring in inflation, and not really growing much when using constant dollars.

So the folks extolling the "sales" increase are  not exactly paying attention to the revised numbers, and those constantly forecasting a collapse aren't paying attention, as well. 

No news is actually good news, in this case, or at least in my humble opinion.

 

 

5-16-23, Advance Retail Sales Report for April

Advance Monthly Sales for Retail and Food Services, April 2023.

Advance estimates of U.S. retail and food services sales for April 2023, adjusted for seasonal variation and holiday and trading-day differences, but not for price changes, were $686.1 billion, up 0.4 percent (±0.5 percent)* from the previous month, and up 1.6 percent (±0.7 percent) above April 2022. Total sales for the February 2023 through April 2023 period were up 3.1 percent (±0.4 percent) from the same period a year ago. The February 2023 to March 2023 percent change was revised from down 0.6 percent (±0.5 percent) to down 0.7 percent (±0.2 percent).

Retail trade sales were up 0.4 percent (±0.5 percent)* from March 2023, and up 0.5 percent (±0.5 percent)* above last year. Nonstore retailers were up 8.0 percent (±1.2 percent) from last year, while food services and drinking places were up 9.4 percent (±2.5 percent) from April 2022.

As always, these figures are not adjusted for inflation, so +1.6% above year ago levels, when inflation adjusted comes down to something like -3.2%.

Now for those revisions. Yes, April was up 0.4% from previous month, which was revised from -0.6% to -0.7%. Doesn't seem bad, until you look at the previous month's revisions.

The revisions for January, February, March were sizable. So after those sizable revisions... you do end up with -0.7% for the previous month. 

We seem to be on a trend of downward revisions, and then extolling the current report. I suspect this month will be revised downward for next month... so next month can seem like a positive. 

So, I do not have a positive spin on this report.

As has been the case for several months, the "quantity" has remained stagnant, while spending increases. 

Adjusting for inflation, the actual volume of sales has remained rather flat for the past two years. 

There were winners and losers, but the revisions really distorted previous lists of winners and losers... such that I cannot attempt a realistic review. (Mostly laziness)!