Flash Update
FLASH UPDATE
November 14, 2007
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October "Core" Retail Sales Unchanged
Data Massaging Gets Worse as Energy Prices Collapse(?)
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PLEASE NOTE: The SGS-Alternate CPI will posted be later tomorrow (Thursday) on the Alternate Data Series tab at www.shadowstats.com, following the release of October CPI data. Barring extraordinary developments, no further Flash Updates are anticipated prior to the November newsletter, which is targeted for posting over this weekend/Monday. -- Best wishes to all, John Williams
The seasonally-adjusted October retail sales number was reported this morning as up by 0.16% (unchanged net of revisions) +/- 0.7%, after increasing by 0.65% (previously 0.58%) in September. Year-to-year growth was reported at 5.15% for October, versus 4.86% in September.
If the Fed and Wall Street hypesters are going to tout "core" inflation, net of food and energy, at least they should be consistent and go to town over "core" retail sales, net of gasoline station and grocery store sales, which vary primarily based on those otherwise meaningless energy and food prices. So, this month we offer "core" October retail sales, which was unchanged from September.
There does appear, however, to be an understatement of both food and energy inflation in play. Despite successive months of exploding oil and food prices, the seasonally-adjusted October PPI was up by a subdued 0.1% (0.7% unadjusted) for the month, helped by a fortuitous 0.8% contraction in energy prices. Food inflation was up an understated 1.0%. Annual PPI inflation for October, however, spiked to 6.1% from 4.4% in September.
Whatever happens with tomorrow's October CPI release, any monthly change that is more positive than a 0.4% contraction (last October's seasonnaly-adjusted monthly change), will add directly to last month's annual inflation rate of 2.8%, by the differential.
Further details will follow in the November SGS newsletter.
The target date for the posting of the November SGS is for over this weekend/Monday.