Consumers seem to be growing more confident in the economy as retail sales for February posted their largest gain in five months, according to last week’s report from the Census Bureau. Retail and food services sales for the month hit $407.8 billion, an increase of 1.1 percent from January, and 6.5 percent over February 2011.
Total sales for the December 2011 through February 2012 period were up 6.4 percent from the same period a year ago. The December 2011 to January 2012 percent change was revised from 0.4 percent to 0.6 percent.
Retail trade sales were up 1.1 percent from January 2012 and 6.3 percent over last year. Key gains were experienced by dealers of building materials and garden equipment and supplies, whose sales were up 13.8 percent from February 2011, and gasoline stations, whose sales were up 10.3 percent from last year.
Phoenix Arizona retail sales increased 6.8% in January compared to year earlier levels. Maricopa County retail sales were up 5.8% for the same time period. While this is moderate given the extent of the decline during the recession, it is still respectable and should continue. Autos and light trucks continue to do well.
Prices certainly didn’t impact February’s sales, as last month’s consumer price index for all urban consumers (CPI-U) increased 0.4 percent, according to numbers the Bureau of Labor Statistics reported today. Over the last 12 months, the all-items index increased 2.9 percent before seasonal adjustment.
A key factor contributing to February’s CPI gains was the gasoline index, which rose sharply in February, accounting for over 80 percent of the change in the all-items index. The gasoline increase led to a 3.2 percent rise in the energy index despite a decline in the index for natural gas. The food index was unchanged in February, with the food-at-home index unchanged for the second month in a row as major grocery store food indexes were mixed.
Similarly, the producer price index for finished goods advanced 0.4 percent in February, the Bureau of Labor Statistics also reported. Finished goods prices rose 0.1 percent in January after a decrease of 0.1 percent in December. The increase in finished goods prices, like consumer prices, was led by energy. The index for finished energy goods moved up 1.3 percent, while prices for finished goods less foods and energy rose 0.2 percent.
Turning to employment, initial claims for jobless benefits by the newly unemployed placed in the week ending March 10 dropped to 351,000, a decrease of 14,000 from the previous week’s revised figure of 365,000, according to last week’s report from the Employment Training Administration. The four-week moving average was 355,750, unchanged from the previous week’s revised average.
The Administration also reported last week that the total population of insured unemployed workers during the week ending March 3 dropped to 3,343,000, a decline of 81,000 from the preceding week’s revised level of 3,424,000. The four-week moving average was 3,394,250, a decrease of 25,250 from the preceding week’s revised average of 3,419,500.
This week’s financial headlines see a good bit of real estate news, kicking off tomorrow with housing starts and building permit totals for new homes in February from the Census Bureau. This will be followed Wednesday with February sales data for existing homes from the National Association of REALTORS®. Friday we’ll receive new home sales data for February from the Census Bureau.