Announced this morning, Retail Sales for January increased 5.3%, much higher than the 1.1% expected. Non-store Retailers, Electronics & Appliance stores, and Furniture & Appliance stores were especially strong, all increasing more than 10% in January, while Health & Personal Care stores were flat. In addition, there was a rebound in Food Services and Drinking Places which were up 6.9% in the month. The Control Group, which excludes sales for food, autos, building materials, and gas stations, increased 6.0% in January, also much higher than expected. Overall, a strong rebound from the negative readings the previous month; however, part of the strength may be related to recently passed fiscal stimulus and could prove temporary. Increased activity in the months ahead will be key to a lasting economic recovery, as vaccine distribution continues giving people confidence to return to pre-pandemic activities. In all, bond yields are little changed this morning with the US 10-year treasury bond above 1.3% for the first time since February 2020 and equity futures are slightly lower as we head into the market open.
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