The U.S. retail sales and unemployment claims data show an economy moving ahead at a fair clip but probably should be
read with caution as holiday effects work their way through the data.
November retail sales posted +0.7%, ex autos posted +0.4%, and ex autos and gas +0.6%, showing better-than-expected strength into the holiday sales period, which began early in 2013 due to the compression of Chanukka close to Thanksgiving.
However, December remains most important for determining sales totals as most selling is done closer to Christmas. So the strength seen in these early numbers might be borrowed from December.
Core sales ('control group') as defined by the Commerce Department posted +0.45% as only food at -0.1% and clothing -0.2% were weak, and most other areas surged. Electronics posted +1.1%, furniture +1.2%, and electronic and mail orders +2.2%. Restaurants were up 1.3%.
Building materials were +1.8% and autos and parts another +1.8%.
October-November sales are +1.1% SAAR from Q3 after large up-revisions to September and October sales. The Q4 totals are shaping up to be strong, though we again caution that December could alter the picture radically.
Initial Unemployment Claims jumped 68,000 to 368,000 in the Dec. 7 week, but this is not a useful analytic. The Labor Department claims analyst said claims are "still showing volatility around the holidays" after state offices had closings for Thanksgiving.
Instead, we would focus on the 329,000 four-week average as being closer to reality. Claims often fall at the holiday week, then surge, then fall again. There is no reason to think this pattern will not hold in 2013. The unadjusted claims gain was 146,241.
Claims averaged almost 325,000 in September before computer problems and holidays distorted the data--very close to the current moving average.
Continuing claims were 2.791 million in the Nov. 30 week, up 40,000 from the prior period.
In a another report released at the same time, November import prices posted -0.6% in a second drop led by oil, and were unchanged excluding fuel. The over-the-year pace remains a subdued -1.5% for overall imports, showing no inflation pressure from this sector.
The declines in the October-November period were the largest since April-May. Import prices have dropped in six of the eleven available months of 2013. Most of the major finished goods categories contributed to the dip.
Import prices from China were unchanged and from Japan -0.1%, even with rising prices for computers and peripherals and parts.
Export prices posted +0.1%, also subdued. Non-agricultural export prices also posted +0.1%.
