Today, the Census Bureau reported that retail sales in March increased by a seasonally adjusted 0.9 percent. While that was the first such positive figure in four months, it was less than the 1.1 percent increase analysts expected, and did little to calm fears that the economy contracted during the first quarter of 2015.
An unbylined report at Bloomberg News and a dispatch from Josh Boak at the Associated Press had sharply differing takes on what the result meant. Longtime readers probably won't have a difficult time guessing who had the bigger set of blinders on.
Surprising absolutely no one, both reports partially used this year's supposedly more horrid than usual winter weather as an excuse-making backstop.
Here's Bloomberg's opening, plus two additional paragraphs (bolds are mine throughout this post):
Lackluster Rebound in U.S. Sales Shows Consumers Hesitant
The March rebound in U.S. retail sales was less impressive than economists forecast, signaling consumers are in no rush to spend the windfall from cheaper fuel prices.
... Americans are focused on using the savings at the gas pump to shore up finances even as employment and confidence firm and interest rates remain low. A boost in wage growth may be what’s needed to drive households to loosen their purse strings and spend more after unusually harsh weather slowed the economy in the first quarter.
“The U.S. consumer is cautious and not ready to go on a shopping spree just because gas prices are lower,” said Thomas Costerg, an economist at Standard Chartered Bank in New York, who correctly projected the retail sales gain.
At the AP, Boak's headline and opening were so different that you have to wonder if someone slipped him a different report:
US RETAIL SALES HEAT UP IN MARCH; HAS BIG THAW ARRIVED?
Americans increased their spending on autos, furniture, clothing and building materials in March, lifting retail sales for the first time in four months.
Retail sales jumped 0.9 percent last month, after declining 0.5 percent in February, the Commerce Department said Tuesday. The rebound suggests that shoppers are returning after an unseasonably cold winter froze sales.
... Economists say that sales should continue to climb because of the yearlong hiring surge and lower gasoline prices.
The Commerce Department published a second report today on February wholesale inventories and sales. The news there also was not good:
... the combined value of distributive trade sales and manufacturers’ shipments for February, adjusted for seasonal and trading-day differences but not for price changes, was estimated at $1,313.1 billion, virtually unchanged (±0.2%)* from January 2015, but were down 1.2 percent (±0.4%) from February 2014.
So we have yet another important stat which is below the level seen a year ago.
The AP's Martin Crutsinger, in a separate filing, had a positive-sounding headline, and spent two paragraphs on the news before going into "happy days are back again" mode:
US BUSINESSES BOOSTED STOCKPILES 0.3 PERCENT IN FEBRUARY
... Economic growth has been slow over the past six months but economists are looking for a rebound in the current April-June quarter, led by stronger consumer spending.
Bloomberg does not appear to have covered the wholesale report.
Today's data adds to the list of items which appear destined to become negative elements or contributors to first-quarter gross domestic product, as seen in the following tables (source data is here for retail and here for wholesale; March wholesale sales, yet to be reported, were estimated, likely overgenerously, to have increased by 3.1 percent to equal March 2014):
Retail sales are only 2.25 percent higher than than they a year ago. Unfortunately, pending revisions to March, they're also 1.27 percent below last year's fourth quarter. On an annualized basis, consistent with how GDP figures are presented, retail sales, an important contributor to personal consumption expenditures in the GDP report, contracted at an annual rate of almost 5 percent during the quarter — and this is before considering inflation. Fortunately, or I should say officially, it has been negligible.
It's worse on the wholesale side, as seen above. First-quarter 2015 sales were 0.72 percent below the first quarter of 2014, and a whopping 3.33 percent (and a shocking 12.66 percent annualized) below the fourth quarter of last year.
It's getting far more difficult to believe that we're going to see a positive first-quarter GDP change figure. In his report on the wholesale data, Crutsinger dropped his "many analysts" estimate to an annualized "1 percent or less" from 1.5 percent last week.
As was the case then, it would appear that writing "or a lot less" would have been far more appropriate.
Cross-posted at BizzyBlog.com.
