Aug 29 - Michigan retailers’ sales projections remain strong
LANSING – More Michigan retailers expect sales to improve for the next three months, following a jump in their July sales, according to the Michigan Retail Index, a joint project of Michigan Retailers Association (MRA) and the Federal Reserve Bank of Chicago.
The Index’s future-outlook component rose to its highest level in 10 years during July, while the improvement in current sales was the best in nearly three years.
“The retail industry’s overall performance increased significantly in July and retailers’ optimism grew even stronger,” said James P. Hallan, MRA president and CEO. “Consumers were flexing their spending muscles after holding back in June,” he said.
“The question now is whether sales can stay at this higher level or they will return to the roller-coaster pattern we’ve seen all year,” he added.
The July Michigan Retail Index found that 53 percent of retailers increased sales over the same month last year, while 31 percent recorded declines and 16 percent saw no change. The results create a seasonally adjusted performance index of 63.9, up from 47.7 in June. A year ago July it was 56.1.
The Index gauges the performance of the state’s overall retail industry, based on monthly surveys conducted by MRA and the Federal Reserve. Index values above 50 generally indicate positive activity; the higher the number, the stronger the activity.
Looking forward, 62 percent of retailers expect sales during August–October to increase over the same period last year, while 13 percent project a decrease and 25 percent no change. That puts the seasonally adjusted outlook index at 82.0, up from 79.3 in June and the highest since 88.2 in October 2004. A year ago July it stood at 67.4.
At the national level, July retail sales excluding autos, gasoline and building materials rose 0.5 percent, the biggest gain since last December, according to the U.S. Commerce Department.
Note: William Strauss, Senior Economist and Economic Advisor with the Federal Reserve Bank of Chicago, can be reached at 312.322.8151.