The Real Retail Sales Growth in The U.S.

When economic figures are made publics and discussed, people often frget that there is inflation and population growth. I order to stay constant, certain values must rise at the combined of those rates or both, for example, GDP.

Another case is reail sales. Are retails sales in the U.S. really going up? Douglas Short has a very interesting chart showing retail sales adjusted for inflation and population growth.

He says: "The Retail Sales Report released this morning shows that retail sales in December were up 0.1% month-over-month (but the Census Bureau notes that the statistical confidence range is ±0.5%). That was well below the Briefing.com consensus forecast of 0.4% and Briefing.com's own expectation of 0.5%.


The charts below give us a rather different view of the U.S. retail economy and the long-term behavior of the consumer. The sales numbers are adjusted for population growth and inflation. For the population data I've used the Bureau of Economic Analysis mid-month series available from the St. Louis FRED with a linear extrapolation for the latest month. Inflation is based on the latest Consumer Price Index. December retail sales adjusted accordingly rose 0.1% month-over-month but only 2.4% year-over-year, far less than the 6.5% nominal YoY increase".
 
(click to enlarge)