Better-than-expected US holiday retail sales

NEW YORK: An influential retail trade group raised its forecast for
US holiday retail sales, citing strong results in November and
expectations that consumers still have more shopping to do.
The
National Retail Federation (NRF) said it now expected holiday sales to
rise 3.8% to a record US$469.1bil. That is up from the group’s October
forecast, which called for growth of 2.8%.
The new forecast is still lower than the 5.2% growth seen last year, but is above the 10-year average increase of 2.6%.
“Consumer
spending this holiday season has surpassed expectations, though many
shoppers continue to stick to their budgets and buy only what they
need,” said NRF chief economist Jack Kleinhenz in a statement.
[You must be registered and logged in to see this image.] Cautiously optimistic: Shoppers at a Best Buy store in Massachusetts. — Reuters
The holiday shopping season, which kicks off unofficially after the US Thanksgiving holiday, is critical for retailers from Wal-Mart Stores Inc and Best Buy Co Inc to Gap Inc.
The
reason for the updated forecast is that NRF, a retail industry trade
group, found that industry sales for November rose 4.5% year-over-year,
and that the average American has completed far less of their holiday
shopping than in previous years – an indication that many shoppers
bought for themselves in November and have lots of shopping left to do.
While retailers are “cautiously optimistic” that the season will turn out better than initially expected, NRF president Matthew Shay
said “a number factors, including the debt crisis in Europe and
continued political wrangling in Washington, could impact consumer
spending this holiday season and into 2012.”
The NRF’s figures
compare sales at retail stores with the year-earlier period and exclude
restaurants, gasoline, automobiles and online sales.
That is why
its results look different than those announced by the US Commerce
Department, which said US retail sales grew a weaker than expected 0.2%
in November. — Reuters