Milford chronicle., 1954-05-21
Philadelphia Federal Reserve Bank
Reports on Current Trends

Predictions that business will
turn upward before the year is out
still pNrsist. There is abundant
evidence that Business sentiment is
generally fuoyant. The fact that
busine semen sen recognize that de-
clines thus far have been fairly
moderate, together with their gem
eral confidence in the economy's
long-runN growth trend, seems to
contribute to a feeling that we're
due to come out out of this thing
soon
Seasonal Fluctuations
Another reason for prevalent Op-
timism may be an expectation Of
a seasonal squirt in the fall. Of
course business analysts and busi-
nessmen try to make allowances
for seasonal forces as they look
ahead And statisticians have de-
veloped seasonal factors to adjust
their series Still, seasonal infiu-
ences may be playing a part in
current predictions.
The general impression one gets
from looking at seasonal tiuctu-
ations of major indicators is that
the best part of the year is ahead
of us. OF course the patterns for the
various indicators vary consider
ably in both magnitude and timing.
Retail trade and construction, for
example, move over very wide
ranges, employment over a fairly
small range. In timing, too, no two
indicators behave the same way.
The general picture, though, is one
of a rising spring, a summer lull,
and a fall squirt.
From here on, businessmen are
likely to give more attention to
seasonal forces than they have for
a long time. For several years,
seasonal movements were lost in
the rapid upward trend. The adjust
ment Of the economy to more nor
NAL" conditions involves not only
an adjustment to lower levels but
also the return of more ups and
downs, including seasonal. This
does not necessarily mean return
of the old pre-war seasonal pat
terms: statisticians and business
men both know that the nature Of
seasonal movements may change
considerably. It does suggest that
the businessman will find it harder
to plan ahead and the business
analyst will find it harder to pre-
dict the future.
SeasOnals In Retail Trade
One area of business in which
seasonal forces are particularly
significant is retail sales. The fact
is, one seldom reads or hears COM
ments on sales by months except
on a seasonally adjusted basis. We
have just passed through a period
when seasOnality is of the utmost
Importance in appraising trends in
the traditiOnally important spring
buying season. Looking back over
the past few weeks, it appears that
Easter business was not spectacu-
lar. but neither was it very dis
appointing.
Department Store Business Has
Steadied
Seasonally adjusted sales by de-
partment stores in this Federal
Reserve District have continued
above the lowest levels reached
last September. Although declines
from a year ago have widened some
what, it should be remembered that
comparisons are with a period of
rising sales in the early months
of 1858. Recent sales trends in some
of the more important city areas
of this District have varied. Phila-
delphia stores have experienced a
little more of rising tendancy than
some of the others. In Lancaster
and Reading the low points in sales
occurred in February, followed by
Improvement in March. Sales in the