Retail Sales Decline Is Blamed On Sandy Although The Real Cause Of Third Quarter Decline Won't Be Known Until After November Numbers

Thursday, November 15, 2012 08:01
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Retail Sales Decline Is Blamed On Sandy Although The Real Cause Of Third Quarter Decline Won't Be Known Until After November Numbers

Tags: economic indicators | Economic Outlook | gas prices

Retail sales took a hit in October, largely as the result of Superstorm Sandy. Retail food and service sales dropped .3% to a seasonally adjusted $411.59 billion. Economists were looking for a drop of .2%.

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The Commerce Department cited both negative and positive influences on the data from the storm.
 
Drops in sales occurred, obviously, because some stores were forced to close or because fewer customers came in.
 
Other retailers saw their sales boosted from customers loading up on supplies ahead of the storm and then buying more goods if they were forced to evacuate.
 
But the retail sales report does not provide regional figures so it’s difficult to say whether Sandy was the only cause or even the primary cause for the decline.
 
The only way to tell will be if there is a bounce-back in retail sales numbers for November.
 
The more volatile energy prices retreated .5% after gaining the previous two months. Those numbers may have been skewed, however, by a seasonal abnormality in passenger car prices.
 
Those prices fell 1.6%.
 
An additional report showed that business inventories increased by .7% because auto dealers added more cars to their lots based on strong sales in the third quarter.
 
There is evidence that growth in the third quarter was stronger than anticipated. The initial estimate of gross domestic product (GDP) indicated that the growth in private inventories was a drag on the economy but stronger reports in September are likely to revise GDP numbers upward later this month.

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