As fate would have it, the initial report for US monthly retail sales
for 12/09 hit my projection of $353 bil. exactly. Yr/yr, the gain in
monthly sales was 5.4%.
The monthly peak was $380 bil. set in 11/07. After that sales
weakened gradually in 2008, until there was a precipitous fall
over the final four months of the year. In an economic recovery,
retail sales can start off gradually, which is what happened this
past year. However, I am now looking for sales to rise 7-8% in
2010 as employment improves and consumer confidence with it.
This is the kind of sales acceleration we should see based on the
strength of the leading indicators and pent up demand built
over 2008 - 2009. A rise in retail in line with my projection would
bring sales back up to the prior 11/07 peak. I am looking for
progressive strength in retail as 2010 wears on and I would
regard a significant shortfall, like perhaps a 5% gain, as a major
disappointment. My guess is that I fall at the high end of the range
among retail sales forecasts.
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