Retail sales declined by a cumulative 2.6% in the past three months (the red line on the 5-year chart below) – the deepest drop since 2009. This is especially surprising given the recent labor market improvements (Jobless Claims are shown by the blue line) and the drop in energy prices. Consumers just aren’t spending the money they saved on gas. On the other hand, the winter months were colder than normal, and we had a lot of snow in many parts of the country. (I know we did in Boston!)

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