“While there’s not much to like about the December report, the October and November results were so strong that fourth-quarter retail sales were still up an impressive 17.1% year-over-year,” Ted Rossman, a Bankrate analyst, wrote to Barron’s Friday morning. “The big question is where we go from here. Especially if inflation is taking a toll and pent-up demand is waning.
While inflation is weighing on consumer sentiment, as surveys show, it’s unlikely that any squeeze on real incomes due to rising prices held back spending in December, said Ian Shepherdson, the chief economist with Pantheon Macroeconomics. He argued that “it’s just not possible to make a judgment like that on the basis of one month’s report.”
Plus, Shepherdson noted, consumers of all income levels are sitting on an abundance of excess savings that should buoy sales moving forward. “Lack of cash is not the issue, so we expect a strong rebound in sales once the Omicron wave subsides,” he wrote in a research note Friday. “January is a probably a write-off, but February and March will be much better.””
http://www.barrons.com/articles/us-retail-sales-december-51642118411?refsec=economy-and-policy
Covid is the enemy. Let the economy fly higher. Omicron is leveling off, and barring a new variant I think the 17.1% growth of last year will be surpassed in 2022.
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