Monday, March 28, 2011

February Retail Sales

The CSO have just released the February Retail Sales Index.  The big jump reported in January was not maintained and retail sales by value and volume slipped back again in February. 

As per usual, we will focus on the sales index that excludes motor sales.  The overall number for February is very heavily skewed towards the motor trade which makes up 33% of the index in February.  Another reason to exclude the motor trade is because it includes the full value of all cars sold.  From a household point of view, the decision to purchase a car will be made on the difference between the cost of the car purchased and the trade-in value of the car sold.  Anyway here are the numbers.

Ex Motor Trades Index to Feb

Only some of the January gains were given up, but the volume index is still lower than it  was in November.  The value index has performed somewhat better, and apart from January, is at a higher level than very month since September.  This is likely influenced by the end of the deflation measured by the CPI.

Although changes to recent months are positive on an annual basis retail sales are still down on last year.

Annual Change Ex Motor Trade Index to Feb

Since July 2008 there has only being one positive change in either annual change series (the volume index in April 2010).  Over recent months both series did get close to breaking into positive territory but fell away each time.  It is clear that the huge slow down in consumer spending seen in 2009 has eased, but all we have it apparent stabilisation rather than real recovery.  February was the first month where the volume series showed a  significantly lower annual change than the value series.

The monthly changes are a bit more volatile and reflect adverse weather in December, early January sales and other factors.

Monthly Change Ex Motor Trade Index to Feb

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