Source: United States Census Bureau. Monthly & Annual Retail Trade.
Note: Excludes motor vehicles and parts.
Monthly Retail Sales and Inventories, United States, 1992-2013
Retailing is a core commercial activity which is reflective of the level of economic activity as well as factors linked to income. It has a pronounced seasonality underlining a cyclical behavior with peak and through periods. The above chart underlines three aspects of this cyclical behavior in the United States (as well as in most developed economies); the long term trend (decades), the cycles of growth and recession (6 to 8 years) and seasonality (annual).
  • Retail sales. Retail sales have steadily been increasing, more than doubling over the 1992-2013 period. A recessionary period between 2001 and 2003 is evident with sales below the long term trend. The 2005 to 2008 period is indicative of higher growth rates with retail sales above the trend, while the financial crisis of 2009 (also labeled the Great Recession) resulted in retail sales for the 2009 to 2011 period well below the trend. Retail sales have a clear annual cycle that begins with the January and February low sales period that gradually increase to reach the May and August higher sales months (summer and school purchases respectively). Sales then decrease in September to gradually increase in October and November, particularly after thanksgiving. December is the most active month of the  year with a significant surge in retail sales, which is clearly associated with the holiday season.
  • End of month retail inventories. Represents the value of all the commercial goods held at stores or distribution centers on a monthly basis. It is considered a leading indicator since inventory accumulation usually precede sales. Retailers are stocking up in October and November (peak inventory accumulation period) in anticipation of the December retail surge, which deplete inventories that reach an annual low point in December and January.
  • Ratio inventories / sales. The trend clearly underlines a long term decline of the ratio as retailers are more active in implementing tighter inventory management strategies, which means the inventory levels are getting more similar with sale's levels. Amplitude has also been declining, implying that retailers are better at synchronizing distribution, inventories and sales.
Retail cycles have a close relation with port activity since many goods are imported from foreign manufacturers and distributors.