US Retail Sales Shrug Off ‘K-Shaped’ Economy With Upside Surprise In November

Having noted yesterday that holiday retail spending (December) was up significantly (via the NRF), today we get the official (US Census Bureau) look at Retail Sales from November… so don’t get too excited.

But, amid the growing specter of the ‘k-shaped’ economy, expectations were for a sizable 0.5% MoM jump in retail sales (after October’s 0.0% nothingburger)… but the headline print beat expectations with a 0.6% MoM surge… leaving sales up 3.3% YoY…

Source: Bloomberg

That was the strongest MoM jump in retail sales since July.

Additionally, Ex-Autos, and Ex-Autos and Gas also both beat expectations.

Ten out of 13 categories posted increases, including sporting goods and hobby stores as well as building materials retailers and clothing outlets. Motor vehicle sales bounced back after the expiration of federal tax incentives on electric cars restrained sales in the prior month. Higher receipts at gasoline stations also contributed to the overall gain.

General Merchandise stores saw sales decline in November (along with Furniture), while Motor Vehicles and Gas Station sales surged the most…

Real retail sales (a rough approximation against CPI) remained positive on a YoY basis…

Source: Bloomberg

Finally, things look even better for the broad economy as the Retail Sales Control Group (which excludes food services, auto dealers, building materials stores and gasoline stations) – which feeds into the GDP calc – jumped 0.4%% MoM – in line with expectations…

Source: Bloomberg

That MoM jump leaves sales up a strong 5.1% YoY and while the ‘k-shaped’ economy continues to weigh on market sentiment, it is not evident in the aggregate data and supports solid Q4 GDP growth.

“The consumer ended 2025 on a strong note might get stronger when tax refunds start hitting in the new year,” said David Russell, Global Head of Market Strategy at TradeStation.

“Today’s retail sales report is consistent with accelerating GDP in Q4, which could push rate cuts further into the future. Whatever happens with Jerome Powell, the era of his relevance seems to be winding down. Further easing with be the concern of his successor.”

The figures may have gotten an extra boost from federal workers, who recouped lost wages from the government shutdown.