Resilient US Consumer: Analyzing December Retail Sales Data – 17/01

 

• US retail Sales (Dec) – 17/01 

The US consumer has proved to be a more resilient beast over the last 12 months, with only 3 negative months over the last 12 months, the most recent of which was in October with a decline of -0.2%. In November we saw a rebound of 0.3% confounding expectations of a -0.1% fall. The improvement was mainly driven by a rebound in food services and bars, as well as sales of sporting goods, while sales at gas stations slowed by 2.9%.

Despite the resilience in spending, consumers do appear to be slowing down compared to what we saw in Q3 which saw very solid spending patterns. Nonetheless another positive number could go a long way to seeing market repricing the likelihood of a Fed rate cut in March which markets continue to see as a realistic possibility.