Retail Sales Soar: Record November Increase
According to a report today from the U.S. Census Bureau, retail sales in the U.S. surged to $385.7 billion in November, a 1.2% gain from October. The monthly sales increase of $4.66 billion was the largest sales increase in U.S. history for the month of November, breaking the previous record of a $3.74 billion retail sales increase in November 2003. On a percentage basis, the 1.2% November sales gain was also the largest in history, matching the 1.2% gain previously established in November 2003.
On an annual basis, the November 2006-November 2007 gain of 6.3% was the largest annual increase in November retail sales since 1999. On a 3-month basis, the increase in retail sales during the September-November period established a new record of $8.5 billion for that period, going back to the start of the series in 1992.
Also, the Census Bureau made an upward revision to September retail sales, which should boost third quarter real GDP from 4.9% to above 5% when the BEA releases final third quarter GDP data around the first of the year.
Bottom Line: Strong gains in retail sales over the last three months, along with record-setting November sales increases, suggest that the U.S. economy is not about to fall into a recession, and to the contrary, is strong and healthy. Keep in mind that the NBER looks at four variables to determine when a recession starts: employment, output, income and retail sales. Recent reports on all four economic variables indicate ongoing economic strength, vitality and expansion, not economic weakness and recession. This is the Energizer Bunny Economy.