December's retail sales were $415.7 billion, a .5% increase over November sales. This was a healthy 4.7% gain over last year. The biggest contributor was auto sales, spurred by record-low interest rates. As the economy improves, these rates are rising, so many people may be getting in now before rates go up further. Auto and truck sales were up a healthy 1.8% in December, contributing to a total 8.5% rise in the last year.
Another sector that benefited from low interest rates was furniture stores, which saw 1.4% better sales than last month and 6.1% better than last year.
Here's some other strong performers:
- Online merchants saw their sales rise 12.6% over last year. In many cases, people shop in brick-and-mortar stores, then actually find better prices online.
- Sporting goods and hobby stores did 9.1% better than the previouis holiday season.
- Holiday shoppers spent 7.7% more in restaurants and bars than they did in 2011.
outperformed every other sector, rising 11.1% above November 2011. The next was sporting goods and hobby stores, up 7.6% above last year. Clothing stores were up 6%, as were restaurants and bars.
Who did poorly? It appeared that people bought less gas in December, since gas station sales were down 1.6% for the month. However, keep in mind that the Commerce Department's survey doesn't offset prices changes, as gas was much lower in December than November. Expect gas station sales to rise in January, as prices are creeping up again as they do every spring.
Another sector that did poorly was electronic and appliance stores, which were down .6% for the month. Electronics stores especially are really losing sales to online merchants, including Amazon. Department stores are also suffering, with sales down 1.7% over last year. (Source: U.S. Commerce Dept, "U.S. Retail Sales," January 15, 2013)
What It Means to You
Despite laggards in some sectors, retail sales performed fairly well in December -- despite uncertainties around the fiscal cliff and taxes. This means that families were willing to spend a little more for a happy holiday season. Other economic indicators show that they are using credit cards less, and using debit cards and layaway more. It also shows that the Fed's Quantitative Easing program is also working, keeping interest rates low and spurring sales in automotive and furniture sectors. All in all, expect a good,solid recovery in 2013.