US Retail Sales: November 2013 Preview

US retail sales are expected to rise 0.5% in Thursday’s update (Dec. 12) for November vs. the previous month, according to The Capital Spectator’s average econometric forecast. The prediction is slightly higher than the previously reported 0.4% increase for October. Meanwhile, the Capital Spectator’s average projection for November is slightly below consensus estimates based on recent surveys of economists.


Here’s a closer look at the numbers, followed by brief definitions of the methodologies behind The Capital Spectator’s projections:
retail.10dec2013.gif
R-2: A linear regression model that analyzes two data series in context with retail sales: an index of weekly hours worked for production/nonsupervisory employees in private industries and the stock market (S&P 500). The historical relationship between the variables is applied to the more recently updated data to project retail sales. The computations are run in R.
ARIMA: An autoregressive integrated moving average model that analyzes the historical record of retail sales in R via the “forecast” package.
ES: An exponential smoothing model that analyzes the historical record of retail sales in R via the “forecast” package.
VAR-6: A vector autoregression model that analyzes six time series in context with retail sales. The six additional series: US private payrolls, industrial production, index of weekly hours worked for production/nonsupervisory employees in private industries, the stock market (S&P 500), disposable personal income, and personal consumption expenditures. The forecasts are calculated in R with the “vars” package.

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