Some of the decline was likely caused by Sandy. An earlier read on October spending showed retail sales fell for the first time in four months, according to Nov. 14 figures from the Commerce Department. While the government said it was able to collect information from storm-affected areas, it said it couldn’t quantify Sandy’s impact.
The storm closed as many as 230 stores owned by Brown Shoe Co., according to Diane Sullivan, the St. Louis-based company’s president and chief executive officer. While all but four locations re-opened within nine days, the operator of the Famous Footwear chain expects fourth-quarter sales were cut by about $2.5 million, Sullivan said during a Nov. 20 earnings call.
Sandy affected 106 Urban Outfitters Inc. stores and curtailed online shopping, reducing fiscal third-quarter revenue by about 1 percentage point, according to Chief Financial Officer Frank Conforti. The impact will be smaller in the fourth quarter, he said on a Nov. 19 call with analysts.
Car and light truck demand also cooled, falling to a 14.2 million pace last month, after Sandy hit during the auto industry’s busiest time of the month. Carmakers have said those sales should be made up by the end of the year.
November Sales
The effect carried over into this month, as well. Retailers posted November same-store sales that trailed analysts’ estimates as Sandy depressed traffic early in the month, overwhelming gains from the start of holiday shopping.
Sales at Macy’s Inc., the second-biggest U.S. department- store company, fell 0.7 percent, compared with the average projection for a 2.5 percent gain from analysts surveyed by researcher Retail Metrics Inc. Target Corp., the second-largest U.S. discount chain, posted a 1 percent decline in same-store sales, missing the estimate for a 2.1 percent increase.
For all of the third quarter, household purchases climbed at a 1.4 percent annual rate, the smallest gain in more than a year and down from a previously reported 2 percent advance, Commerce Department data showed yesterday. Spending increased at a 1.5 percent pace in the second quarter.
Fed’s Dudley
“Although the economy continues to expand, we must grow faster if we are to put all of our jobless workers and idle businesses back to work,” William Dudley, president of the Federal Reserve Bank of New York, said yesterday.
Even so, continued payroll gains, climbing home values and better household finances are lifting Americans’ spirits. The Conference Board’s sentiment index rose to 73.7 in November, the highest level since February 2008, a report showed this week.
Households felt good enough to head to shopping centers on Black Friday weekend. U.S. retail sales rose 13 percent to $59.1 billion in the four days starting Nov. 22 after a 16 percent increase in the similar period last year, according to the National Retail Federation.
Today’s Commerce Department report also showed a measure of prices tied to consumer spending advanced 1.7 percent in October from the same month last year, less than the Fed’s long-run goal of 2 percent. Excluding food and energy costs, the price gauge increased rose 1.6 percent from a year earlier.
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