Retail in December and January

U.S. retail sales in December did better than the early data had indicated, with a slight improvement even after taking price and population changes into account. Sales may decline this month because of the expiration of a temporary payroll tax cut, or they may hold their own if consumers feel more confident with the “fiscal cliff” story laid to rest for the moment. But after a possible dip in January, there is reason to be optimistic about the trend in retail sales in the months ahead.