February 15, 2023
Today the U.S. Census Bureau released preliminary estimates of nationwide retail sales in January 2023 and revised estimates for December 2022. (The data include both brick-and-mortar and Internet sales.)
Retail Sales Appeared to Grow Rapidly. Seasonally adjusted U.S. retail sales increased by 3 percent from December to January. Cumulative twelve-month growth in sales from January 2022 to January 2023 was 6.4 percent.
Are Recent Swings Illusory? As we noted last month, sales declined by an unusually large amount from October to December. For three straight years, we have seen weak sales in November or December followed by very strong growth in January. This pattern suggests that the Census Bureau’s seasonal adjustment for retail sales might not be working as intended. Until these concerns are addressed, numbers that are less sensitive to seasonal patterns---such as the twelve-month growth rate noted above---could provide more useful information than monthly numbers.
Inflation-Adjusted Sales Flat Over Last 12 Months. Across all goods and services purchased by consumers, U.S. prices increased by 0.5 percent from December to January. From January 2022 to January 2023, prices grew 6.4 percent, roughly offsetting the 6.4 percent growth in sales over that twelve-month period.