Excellent sales report from the Dept. of Commerce reflects a 5.8 percent increase year-over year for December 2019. U.S. consumer sales drive two-thirds of GDP; the December result is another indicator the GDP growth in the fourth quarter will likely be much higher than expected.
(Via CNBC) […] The Commerce Department said on Thursday retail sales increased 0.3% last month. Data for November was revised up to show retail sales gaining 0.3% instead of rising 0.2% as previously reported. Economists polled by Reuters had forecast retail sales would gain 0.3% in December. Compared to December last year, retail sales accelerated 5.8%.
It is weird to see how CNBC takes the good news, cites the factual impact of retail sales on GDP, and then proclaims the economy is likely faltering. What the heck?
[…] Though a report last week showed a slowdown in job growth in December and the increase in the annual wage gain retreating to below 3.0%, consumers will continue to shoulder the longest economic expansion on record, now in its 11th year, thanks to higher savings, rising house prices and a bullish stock market.
Consumer spending, which accounts for more than two-thirds of U.S. economic activity, grew at a 3.2% annualized rate in the third quarter.
Growth in consumer spending is expected to have slowed to around or below a 2.5% rate in the fourth quarter. The economy expanded at a 2.1% pace in the July-September period.
Growth estimates for the fourth quarter are as high as a 2.5% rate, in part because of a drop in imports, which compressed the trade deficit. (link)
Retail sales account for more than two-thirds of GDP. So, November sales were revised up; December sales were exceptionally strong with +5.8% year-over-year… and yet “consumer spending is expected to have slowed below 2.5% in the fourth quarter”?
Oh well, I guess the growing wealth of the U.S. middle class means we have to “shoulder the burden” of an astoundingly good U.S. economy…. or something. Go figure.
Apparently CNBC views the American economy as too much winning….