After a solid start to the holiday season, the National Retail Federation (NRF) announced today that it is revising its forecast to 3.3 percent, up from 2.3 percent. The upward revision is due to improvement in a variety of economic indicators including stock market gains, recent income growth and savings built up during the recession — all giving consumers the capacity to spend.
According to the National Retail Federation, November retail industry sales (which exclude purchasing automobiles, buying gas, and eating out at restaurants) increased 0.8 percent seasonally adjusted over October and 6.8 percent unadjusted over last year.
"The start to the holiday season has surpassed all expectations," said NRF president and CEO Matthew Shay. "While employment data is still a concern, we are starting to see improvement in other economic indicators that support an increase to our forecast. In order to sustain this momentum for retailers and the U.S. economy, there must be a renewed focus on jobs as we enter the new year."
November retail sales released today by the U.S. Commerce Department show total retail sales (which include non-general merchandise categories such as autos, gasoline stations and restaurants) increased 0.8 percent seasonally adjusted over October and 9.2 percent unadjusted year-over-year.
"Consumers have not been suffering from a lack of spending power, they've just been missing the confidence to use it," said NRF chief economist Jack Kleinhenz. "With noticeable improvement in key economic indicators combined with great deals on merchandise, consumers have certainly shown they shouldn't be counted out this holiday season."
Solid gains across the board indicate some pent up demand as consumers stocked up on items such as apparel, accessories and books and music. Sales at clothing and clothing accessory stores increased 2.7 percent seasonally adjusted over last month and a strong 9.6 percent unadjusted year-over-year. Sporting goods, hobby, book and music stores sales increased 2.3 percent seasonally adjusted month-to-month and 15.5 percent unadjusted year-over-year.
Health and personal care stores sales increased 0.9 seasonally adjusted over last October and 7.3 percent unadjusted over last year. General merchandise stores sales increased 1.3 percent seasonally adjusted over last month and 4.2 percent unadjusted year-over-year. The NRF is based in Washington, D.C.
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NRF revises holiday forecast up to 3.3 percent
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