Holiday Sales Growth Misses Expectations

RAPAPORT... US holiday sales grew 2.9% in 2018, lower than the 4.3% to 4.8%increase the National Retail Federation (NRF) had predicted. Total sales for the November-December period were $707.5billion, according to figures from the Commerce Department. The officialfigures were released nearly a month late following the partial US government shutdown. That number falls well below the NRF's forecast thatholiday sales would reach $717.45 billion to $720.89 billion, and has leftanalysts questioning the reliability of the information. "All signs during the holidays seemed to show that consumersremained confident about the economy," NRF CEO Matthew Shay said last week."However, it appears that worries over the trade war and turmoil in the stockmarkets impacted consumer behavior more than we expected. There's also aquestion of whether the government shutdown and resulting delay in collectingdata might have made the results less reliable." Online sales grew 11.5% to $146.8 billion, according to thegovernment data. Sales in December alone increased 0.9% year on year following two months of stronger retail revenues.Purchasing in November rose 5.1% over the previous year, while October - which isnot officially part of the holiday season - saw sales climb 5.7% year on year,as consumers began buying earlier than in previous years. "Today's numbers are truly a surprise and in contradictionto the consumer spending trends we were seeing, especially after such strongOctober and November spending," NRF chief economist Jack Kleinhenz said. "Thecombination of financial market volatility, the government shutdown and tradetensions created a trifecta of anxiety and uncertainty impacting spending andmight also have misaligned the seasonal adjustment factors used in reportingdata." The federation will be better placed to assess the results'reliability in the next few months when the government revises its 2018 data, headded. The NRF predicted sales would grow between 3.8% and 4.4% in2019, to more than $3.8 trillion. Image: Mall of America, Bloomington, Minnesota. (Flickr)