Are Census's Retail Figures Something to Set Store By: A Volatile Measure of Growth
When Federal Reserve policymakers meet next week to decide whether economic growth is so strong that they should raise short-term interest rates once more to try to slow it down, one piece of evidence they will be looking at is what hapnened to retail sales in November and December.</br></br>The sales figures reported earlier this month by the Bureau of the Census were completely at odds with what most analysts had expected and with the picture of continued rapid economic growth painted by most other recent statistics. No one quite knows whether to believe them.</br></br>up only 0.2 percent in NovemberÛÓrather than the 1.2 percent it had estimated in its first report last monthÛÓand that sales dipped 0.1 percent in December.</br></br>Is this the leading edge of the long-predicted slowing of growth? Or is it just a temporary flattening of an upward trend? After all, the retail sales numbers make up an extremely volatile series that is frequently revised by significant amounts.</br></br>The chart at the right underscores just how much the figures are revised as Census moves through three monthly stages of reporting the sales on what.it calls the advance, preliminary and final bases. Even the so-called final figures are subject to later revision.