According to a report by the National Retail Federation (NRF), retail sales in the United States have exhibited strong signs of recovery as the country enters the holiday shopping season. Despite the ongoing impact of the Covid-19 pandemic, retail sales have been consistently increasing since June, showcasing a V-shaped recovery with sales rising by 8.6% since January. This positive trend reflects the resilience of consumers in the face of the pandemic, as well as a 5.4% year-over-year boost in personal disposable income as of August. Moreover, the current savings rate of 14.4% has stayed in double digits for six consecutive months, highlighting consumers’ efforts to save.

While consumer confidence is on the rise, retail spending has played a pivotal role in the overall recovery of consumer spending. In April, consumer spending witnessed a substantial decline of 16.1% compared to the previous year. However, it has managed to recover significantly, with only a 1.9% decline observed presently. Nevertheless, the NRF warns about the potential threat posed by the increasing number of coronavirus cases in the US to the ongoing retail recovery.

Jack Kleinhenz, the NRF’s chief economist, emphasizes the significance of additional federal stimulus in order to sustain the current recovery and prevent any setbacks in economic progress. The NRF has yet to release its holiday spending forecast, but a recent study conducted in collaboration with Prosper Insights & Analytics discloses that consumers plan to spend an average of $997.79 during this holiday season, representing a slight decrease from last year’s figures.

Useful links:
1) National Retail Federation
2) Prosper Insights & Analytics