Americans picked up their spending from October to November as the unofficial holiday season kicked off, underscoring that shoppers still have power to keep buying, according to a report from the Associated Press.
Retail sales rose 0.3%, in November from October, when sales were down a revised 0.2% according to the Commerce Department. Economists were expecting sales to decline again. Excluding car and gas sales, sales rose 0.6%.
Business at restaurants rose 1.6%, while sales at furniture stores rose 0.9%. Online sales rose 1%. Electronic and appliance sales, however, fell 1.1%. Sales at department stores fell 2.5%. The figures aren’t adjusted for inflation.
The urge to spend for Americans appears to have some running room, even after a blowout summer. Consumer spending jumped in the July–September quarter. Economists have been expecting spending to slow in the final three months of the year as credit card debt and delinquencies rise, and savings fall.
U.S. employment data last week showed that employers added 199,000 jobs in November and the unemployment rate declined to 3.7%. Inflation has plummeted in little over a year from a troubling 9.1%, to 3.2%. While that’s still above the desired level, the economy by most counts is likely to avoid the recession many economists had feared, a potential side effect of U.S. attempts to cool inflation.
The National Retail Federation, the nation’s largest retail trade group, still expects shoppers will spend more during the 2023 winter holidays than last year.
The group forecast in November that U.S. holiday sales will rise 3% to 4% for November through December. That is slower than the 5.4% growth over the same period a year ago, but more consistent with the average annual holiday increase of 3.6% from 2010 to pre-pandemic 2019.
