Consumers leveled off post-holiday shopping and spending in the beginning of the year due in part to severe winter weather in much of the country. According to the National Retail Federation – the world largest retail trade association – January retail sales, excluding automobiles, gas stations and restaurants, were flat seasonally adjusted month-to-month yet increased 3.0 percent unadjusted year-over-year.
“Following a solid holiday sales season, it seems that many consumers decided to take a break from the stores and shopping malls this January in an attempt to avoid winter weather,” NRF President and CEO Matthew Shay said. “While the dip in retail sales was somewhat anticipated, it is concerning that both jobless claims came in above projections and that consumer spending were flat in January – it’s not the way to kick off a new year.
“Even though policymakers decided wisely to increase the debt ceiling this week so the nation would not default on its obligations, more can be done to spur consumer confidence and spending and employment and economic opportunity.”
January retail sales, released today by the U.S. Census Bureau, which include categories such as automobiles, gasoline stations, and restaurants, decreased 0.4 percent seasonally adjusted month-to-month yet increased 2.6 percent adjusted year-over-year.
“Harsh winter weather is masking the performance of the broader economy,” NRF Chief Economist Jack Kleinhenz said. “Extreme temperatures and severe ice and snow are making it increasingly difficult to assess if the retail sales slowdown is temporary or a telling sign of a longer lasting weakness in the consumer-fueled economy. No one can jump to any solid conclusion until we shovel out of the snow.”
Earlier this month, NRF released its annual economic forecast projecting a 4.1 percent increase in retail sales in 2014.
Other findings from the January retail sales report include:
- Clothing and clothing accessories stores' sales decreased 0.9 percent seasonally-adjusted month-to-month yet increased 1.4 percent unadjusted year-over-year.
- Furniture and home furnishing stores’ sales decreased 0.6 percent seasonally-adjusted month-to-month and 2.1 percent unadjusted year-over-year.