Danish economy continues to grow in 2019, growth likely to decelerate in 2020 on slowdown in global economy
U.S. retail sales rise in line with market expectations in December
U.S. retail sales came in line with market expectations in December. On a sequential basis, the retail sales grew 0.3 percent. Meanwhile, the November data was upwardly revised to 0.3 percent from 0.2 percent recorded in the advance estimate. The rebound was widespread, with sales rising in all but one category. The volatile autos and parts dealers fell 1.3 percent. Among the remaining volatile groups, sales rose 2.8 percent at gasoline stations, 1.4 percent at building material & garden equipment stores and 0.2 percent at food services & drinking places.
Sales in the retail sales “control group”, which excludes volatile components rose at much better pace of 0.5 percent, a bit above forecast of a 0.4 percent rise. However, control group sales in the prior month were downwardly revised to -0.1 percent from +0.1 percent in the advance estimate. In light of a weaker performance at the start of the quarter, control group sales dropped 0.3 percent annualized in the fourth quarter, a marked slowdown from 7.9 percent and 6 percent pace in the second and third quarter respectively.
Within the control group, monthly gains ranged from the low of 0.1 percent in miscellaneous and furniture & home furnishing stores to 1.6 percent in clothing & accessory stores. Sales at non-store retailers, a typically fast-growing category, rose just 0.2 percent on the month.
Following a weak performance in November, American consumer loosened the purse strings in December. In spite of the year-end boost, ‘control group’ sales in the fourth quarter was unable to keep up with their speedier pace in the prior two quarters, noted TD Economics in a research report. With services spending buoyant, real consumption growth is expected to have stayed in a healthy range of between 2 percent and 2.5 percent in the fourth quarter.
“The December gain provides a solid handoff to retail sales at the start of 2020. Meanwhile, strong consumer fundamentals, including still-sturdy job and income growth, should help carry the healthy consumption trend forward. The recent signing of the 'phase one' trade deal with China is expected to lend additional support, at least in the near term. The deal, which lowers tariffs on some goods and hits the pause button on additional tariffs, should provide added peace of mind for the American consumer for the time being. But, with several outstanding thorny issues to be tackled in a second phase, trade negotiations could prove a wildcard further out”, added TD Economics.