Auto sales miss expectations but still very strong

March auto sales came in below expectations, but as this chart shows, they have been and remain exceptionally strong. This is a series that is volatile on a month-to-month basis, so it's important to look at the larger trend, and in this case it is decidedly up. Sales are up 9.7% over the past 12 months, in fact, and the 3-month moving average of sales is up 11.5% over the same period. Over the past six months, the 3-month moving average of sales is up at a blistering 35.5% annualized rate.

The auto sector remains one of the most impressive sectors of this recovery so far. After suffering one of its worst disasters in history, that's not all that unusual, but still, the recovery in sales has been spectacular given that the labor market is still far from making a decent recovery. Three years ago, no one would have guessed that the auto sector would stage such a remarkable comeback. This is a very important change on the margin that has stimulative, ripple effects throughout the economy.