by Bill McBride on 6/30/2011 04:15:00 PM
Thursday, June 30, 2011
The restaurant index is one of several industry specific indexes I track each month. The following report is for May.
From the National Restaurant Association: Restaurant Industry Outlook Softened in May as the Restaurant Performance Index Fell Below 100 for First Time in Six Months
The National Restaurant Association’s Restaurant Performance Index (RPI) – a monthly composite index that tracks the health of and outlook for the U.S. restaurant industry – stood at 99.9 in May, down 1.0 percent from April’s level. May represented the first time in six months that the RPI stood below 100, which signifies contraction in the index of key industry indicators.Click on graph for larger image in graph gallery.
“Like the economy as a whole, the restaurant industry’s recovery hit a speed bump in May, with same-store sales and traffic levels softening from recent months,” said Hudson Riehle, senior vice president of the Research and Knowledge Group for the Association. “However, the overall economic fundamentals of the restaurant industry remain positive, which will likely lead to stronger performances in the months ahead.”
Restaurant operators reported softer same-store sales results in May. ... Restaurant operators also reported a net decline in customer traffic in May.
The index decreased to 99.9 in May (above 100 indicates expansion).
Unfortunately the data for this index only goes back to 2002.
The economy clearly slowed in May, so a decline was expected. This is a minor report (really not even "D-List" data), but I'd expect discretionary spending to slow sharply if consumers become really worried - and that doesn't seem to be happening.