Economists' Outlook

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Instant Reaction: Retail Trade Sales February 18, 2021

January 2021 seasonally adjusted advanced estimates of United States retail and food services sales saw a strong increase from December sales figures, with aid from the government stimulus package, vaccine rollout, and better COVID numbers as momentum from a historic holiday season carried over. January sales represent a sharp pivot from the decreasing sales trend seen over the past few months. Retail and food service sales are estimated at $568.2 billion, which is a 5.3% increase from prior month figures as typical consumer spending trends at this time of year were absent. This increase in spending was also supplemented by consumers being more confident with the easing of local and state limitations. Without some barriers in place, year-over-year sales were 7.4% higher than January 2020.

Retail trade sales increased 5.1% from the prior month and were up 10.8% from the same period a year ago. Although retail trade sales declined in December for the 3rd consecutive month at that time, retail trade sales had a unique and record holiday season that saw sales grow 7.0% year-over-year despite economic obstacles as a result of the coronavirus pandemic. January’s sharp increases continue the momentum observed during that historical holiday season and with current COVID trends, vaccines and discussed $1.9 trillion COVID relief bill progression, current consumer spending trends should continue moving forward.

January’s advanced sales saw year-over-year and month-over-month increases across majority of retail. Year-over-year increases were led by non-store retailers, up 28.7% and sporting goods, hobby, musical instrument, and book stores, up 22.5% year-over-year. Month-over-month increases were led by department stores, up 23.4% which is a robust increase from department store prior sales figures. Electronic and appliance stores followed with a 14.6% month-over-month increase. Non-store retailers also had a month-over-month increase of 10.9%.

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