Definition: The retail sales data
provides valuable information about consumer spending--the consumption
part of the gross domestic product (GDP). Consumption spending accounts
for more than one- half of GNP.
Source: U. S. Commerce Department
Availability: About two weeks following the reported month
Likely Impact on Financial Markets:
Interest Rates: Larger-than-expected monthly increase or increasing
trend is considered
inflationary, causing bond prices to drop and yields and interest rates to rise.
Ability to Affect Markets:
Analysis of the Indicator:
Retail sales data represents merchandise sold for cash or credit by
retailers. Durable goods, such as
autos, make up 35% of the figure. The balance consists of nondurables, such as gasoline, restaurants,
and general merchandise.
There are several drawbacks to the report. The data covers purchases
of goods only, not services. It is
not adjusted for inflation and it is extremely volatile.
The bond market reacts negatively to a strong report.
A Graph of the latest Retail Sales data from The Economic Statistics Briefing Room of the White House
The latest GDP report from BLS.