Monday, November 30, 2015

Restaurant Performance Index indicates faster expansion in October

by Bill McBride on 11/30/2015 12:31:00 PM

Here is a minor indicator I follow from the National Restaurant Association: Restaurant Performance Index Rose in October

Driven by stronger same-store sales and a more optimistic outlook among restaurant operators, the National Restaurant Association’s Restaurant Performance Index (RPI) posted a moderate gain in October. The RPI – a monthly composite index that tracks the health of and outlook for the U.S. restaurant industry – stood at 102.1 in October, up 0.7 percent from a level of 101.4 in September. In addition, October represented the 32nd consecutive month in which the RPI stood above 100, which signifies expansion in the index of key industry indicators.
...
“The October gain in the RPI was buoyed by broad-based improvements in the current situation indicators,” said Hudson Riehle, senior vice president of the Research and Knowledge Group for the Association. “In addition, restaurant operators are somewhat more optimistic about both sales growth and the economy in the months ahead.”
emphasis added
Restaurant Performance Index Click on graph for larger image.

The index increased to 102.1 in October, down from 101.4 in September. (above 100 indicates expansion).

Restaurant spending is discretionary, so even though this is "D-list" data, I like to check it every month.  This index is indicated decent expansion in October, and it appears restaurants are benefiting from lower gasoline prices and the improved labor market.