FXStreet (Mumbai) – The US retail sales data will be published today at 13.30 GMT. The retail report published in January is the most one for the year as it tracks the sales figures and volumes for the holiday season when consumer spending is usually at its peak. Thus to gauge the retail sales figure for December 2015, it is important to have a look at how the retailers performed in the holiday season and also study other significant factors like the weather, which has a considerable impact on retail sales.
The markets broadly estimate the retail sector stagnated in December. It grew 0.2 per cent in November. U.S. households spent $95.5 billion online during the holiday season. Retail sales increased just 1.4 per cent in the 12 months to November 2015. Even after excluding gas, sales grew only at a meagre 3.7 per cent pace during that same period, way below the 5 per cent growth pace seen in better days.
To begin with, the sale of apparels dipped as the warm weather discouraged shopping for winter garments. Industry research groups showed that the “Super Saturday” before Christmas sales stayed a little subdued and retailers were found to struggle to meet forecasts.
The latest trend is that people shop in the very last minute and it is this last minute shopping which determines the performance of the retailers in the holiday season. This year, sales have remained weak in the final weekend leading economists to believe that the retail sector growth for December is bound to disappoint.
The National Retail Federation forecast a 3.7 per cent rise in store and online sales in December. Retail consultancy and private-equity fund Customer Growth Partners said via Reuters that Super Saturday weekend sales in stores and online increased 4 per cent to $55 billion. The overall store and online sales from the start of November through Dec. 22 will likely rise to 3.1 per cent, lower than the 3.2 per cent growth pace expected by the firm and also below the 4.1 per cent growth seen in the same period last year. Craig Johnson, president of Customer Growth Partners mentioned sales were sluggish “as most consumers are still buying close to need”.
Also, even as sales volumes in the electronics goods category remained robust sales margin was hurt due to large discounts. Discounts across categories were higher. Discounts were in the range of 20 per cent to 50 per cent, according to Traci Gregorski, vice president of marketing at analytics firm Market Track. The US consumer is now more inclined towards saving and has shown signs of weakness for a few years now. Consumers are on a constant lookout for better bargains. This discipline in spending on part of the customers has led retailers to cut prices and offer more sales. This explains why even though the number of products sold is increasing sales in dollar terms are continuously slipping.
(Market News Provided by FXstreet)