For a report with little change, there is a lot going on behind the curtain.
The headline reads June Retail Sales up 0.2%. Not as optimistic as Wall Street hoped for, they expected a plus 0.5%, but apparently OK.
Let’s dig a little deeper. The Census Bureau conducts this survey of Retail Sales, and the first thing they tell us is that Sales are not adjusted for inflation. Coincidentally, inflation for June was a drum roll, 0.2%. That means, of course, that we don’t see any increase in Retail Sales. The numbers are merely reflecting the results of inflation.
But there is more. Census has widened their confidence range for this survey. That is, they are confident within a range of +-0.5%. They’re pretty sure Retail Sales were somewhere between +0.7% and -0.3%. That’s a pretty wide confidence range and indicates a fair amount of uncertainty in the Survey. You’ll note that they had to adjust their results by 0.5% last month.
All in all, it shows there is a lot going on in this economy, not the least of which is the impact of inflation, and the Census Bureau is having a hard time getting a handle on it.
Retail Sales (blue, left scale) CPI Inflation (red, right scale)