Consumers Expected to Spend More This Holiday Season
- Oct 13, 2014
The International Council of Shopping Centers, in a report released late last week, forecasts that U.S. holiday retail sales will improve 4 percent this year compared with 2013 (the organization counts sales in November and December as holiday sales). If that happens, it would be the strongest growth for this particular consumer metric in three years.
A number of factors are working together to improve holiday spending this year, ICSC notes. Consumer confidence is higher than a year ago, for one thing, bolstered by lower unemployment rates and some gains in personal income. The reported also noted that the hiring of seasonal workers, which is an indicator of holiday sales, is expected to rise 7.3 percent compared with last year.
Similarly last week, the National Retail Federation predicted that holiday sales are going to grow 4.1 percent year-over-year. If so, that would mark the first time since 2011 that sales increase more than 4 percent. The organization says that holiday sales on average have grown 2.9 percent over the past 10 years, including 2014’s estimates, and are expected to represent about 19.2 percent of the retail industry’s annual sales of $3.2 trillion.
Even so, that might not mean shoppers are throwing caution to the wind. “Recognizing the need to keep household budgets in line, we expect shoppers will be extremely price sensitive, as they have been for quite some time,” NFR CEO Matthew Shay notes. “Retailers will respond by differentiating themselves and touting price, value and exclusivity.”
FNC home price data shows slowing appreciation
FNC released its August index data on Friday, showing that the company’s Residential Price Index increased 0.8 percent month-over-month (in the composite 100 index, measuring the top 100 MSAs in the country, excluding distressed sales). Its other indexes (10-MSA, 20-MSA, 30-MSA) increased between 0.9 percent and 1.1 percent for the month.
The year-over-year change was the same in August as in July, with the 100-MSA composite up 7.5 percent compared to the same month last year. Still, the FNC is latest in the parade of indexes that show a slowdown in the rise of residential values, since its year-over-year increase has been slowing down since peaking this February at 9.4 percent.
Wall Street dropped again on Friday—could be those traditional October jitters—with the Dow Jones Industrial Average off 115.15 points, or 0.69 percent. The S&P 500 declined 1.15 percent and the Nasdaq dropped a sizable 2.33 percent. On the whole, the equities markets had their worst week since May 2012.