(Washington; Jan. 15, 2002;
PRNewswire) Standard & Poor's, a leading source
for financial information and investment analysis said
that the December 2001 U.S. retail sales figures released
today adhered to a now familiar pattern for fourth
quarter economic reports. Standard & Poor's noted
that the information outpaced expectations, with
broad-based surprises to the upside for most of the major
spending components in both November and December.
``The Government's report confounded
expectations of a poor Christmas shopping season, as
spectacular sales gains in October are now reported to
have been only modestly reversed during the ensuing two
months,'' said Michael R. Englund, chief market
economist, Standard & Poor's MMS. ``The full set of
consumer spending figures for the fourth quarter proved
to be quite extraordinary given the events of September
11, let alone the negative impact that had been expected
by economists prior to September 11 from the unwinding of
the huge tax rebate payments during the summer months.
The reported data were also depressed by a freefall in
energy prices during the quarter that was actually good
news for the consumer.''
Standard & Poor's believes that
the retail sales figures for the fourth quarter suggest
that growth in real consumption will have exceeded 4%
during the last quarter of 2001 when the GDP figures are
eventually reported. This fourth quarter strength will
likely prove to have been accompanied by a hefty gain in
government purchases and resilience in the construction
sector.
Standard & Poor's continues to
project a flat GDP figure in the fourth quarter of 2001,
but weakness will be due almost entirely to a colossal
pace of inventory liquidation during the quarter, and not
the spending weakness that was once feared. Weakness will
also likely be seen in business fixed investment and
exports which should hold down growth in final sales to
the 1% area.The story for the quarter is one of inventory
liquidation rather than consumer caution, as the
liquidation pace actually increased during the quarter
from the record pace of inventory draw-down already
reported for the third quarter.
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