Retail sales and industrial (not manufacturing) output were well above market expectations.
figure 1: Nonfarm employment (dark blue), industrial production (red), 2012 personal income excluding transfers (green), 2012 manufacturing and trade sales (black), 2012 consumption (light blue), and 2012 Monthly GDP (pink) for January of the year, all log normalized to 2020M02=0. NBER defines recession dates, peaks and valleys, shades of gray. Sources: BLS, Federal Reserve, BEA, via FRED, IHS Markit (nee Macroeconomic Advisers) (published Feb. 1, 2022), NBER, and author’s calculations.
Retail sales are not in the graph above. However, amid a rebound in retail sales, this suggests that manufacturing and trade sales levels remain unchanged (black line in Figure 1).
figure 2: Excluding retail sales of food services, $1982 million (blue, left log scale), and manufacturing and trade industry sales, in billions Ch. 2012, SAAR (red, right log scale). Manufactured goods using PPI reduced retail sales. Recession peak and valley dates as defined by NBER are shaded in gray. Source: Census by FRED, FRED, BLS, NBER, and author calculations.
Regression on the samples shown above yields (in the first log difference) adjusted R2 0.81, and the slope coefficient is 0.72.
Implied foodservice sales (the gap between FRED Series RSAFS and RSXFS) declined in January, possibly reflecting the impact of omicron.
image 3: Foodservice sales, in millions of dollars, sa (black), in millions of dollars, in 2020 dollars, sa (turquoise). Actual series use CPI deflation. Source: Census, BLS by FRED and author’s calculations.
Adjusted for (CPI) inflation, the downward trend has continued for several months.
