The National Retail Federation is optimistic about the 2015 holiday season, expecting November and December sales to rise 3.7 percent to $630.5 billion, but for recreational marine companies the question is how much of that pie will be served to them.
“With several months of solid retail sales behind us, we’re heading into the all-important holiday season fully expecting to see healthy growth,” retail federation president and CEO Matthew Shay said in a statement.
“However, while economic indicators have improved in several areas, Americans remain somewhat torn between their desire and their ability to spend; the fact remains consumers still have the weight of the economy on their minds, further explaining the complex retail spending environment we are seeing right now. We expect families to spend prudently and deliberately, though still less constrained than what we saw even two years ago.”
“Potential disruptions from yet another government shutdown in mid-December and a slower pace of job creation and income growth are just a few key factors that will impact holiday shoppers’ spending this year,” Shay continued.
“Price, value and even timing will all play a role in how, when, where and why people shop over the holiday season. Retailers will be competitive not only on price, but on digital initiatives, store hours, product offerings and much more.”
A survey from the retail federation found that average holiday spending per person is likely to reach $805.65 this year, comparable to the 2014 season’s $802.45.
The federation’s forecast was buoyed Friday by the latest measure of the mood of American consumers. The University of Michigan’s preliminary consumer sentiment index for November rose to 93.1 from a final October reading of 90.0.
"Confidence rose in early November, mainly due to a stronger outlook for the domestic economy," Richard Curtin, director of the Michigan Survey of Consumers, said in a statement. “Buying plans remained very favorable in early November due to low prices and currently low interest rates.”
Bloomberg reported that the gain in confidence was propelled by people in the bottom two-thirds of the pay scale. A firming job market and cheap fuel costs made for the most favorable income expectations in almost nine years.
That bodes well for the holiday-shopping season after retail sales were weaker than projected last month.
The Commerce Department reported Friday that sales edged up 0.1 percent in October. They were unchanged in September and August.
Sales at auto dealerships fell 0.5 percent for the month after rising 1.4 percent in September. Reuters said the decline was surprising because automakers reported strong sales in October. Economists said heavy discounting to attract buyers was likely to blame for the discrepancy.
However, they are optimistic about consumer spending this month and in December as job growth gains and low inflation boost disposable income.
The University of Michigan survey supported that view, revealing an improvement in buying plans for large discretionary purchases — cars, in particular. Lower-income households also were upbeat about their prospects.
There are few reports on the business calendar this week, but one is of particular importance — the Labor Department’s Consumer Price Index for October, which will be released today.
Business Insider said that if the index shows prices are steadily rising, it could harden the Federal Reserve’s resolve to raise interest rates at the Federal Open Market Committee’s meeting in mid-December.
"We have had a strong October jobs report and Fed chair Janet Yellen herself referring to a December rate rise as a 'live possibility' for the first time," Chris Hare, economist at Investec, told Business Insider.
"The coming week should shed a little more light on the prospects for tightening this year."