CNBC – January is typically an overlooked month for retailers. Shoppers make returns and exchanges. They come to stores with gift cards in hand. And they may spring for workout clothes or other items to follow through on New Year’s resolutions.
But this year, January carries higher stakes. The next few weeks, which close out many retailers’ fiscal year, could help determine whether the holiday quarter is a win or a bust. It’s an essential time for helping stores clear out excess inventory, too. January could also set the tone for 2023 — when some economists and retail industry watchers anticipate the U.S. will tip into a recession.
So far, early holiday results have been better than some economists and retailers feared. Sales from Nov. 1 to Dec. 24 rose 7.6%, according to MasterCard SpendingPulse, which measures in-store and online retail sales across all forms of payment – learn more here. The figure includes restaurants and is not adjusted for inflation, which rose 7.1% year over year in November. See the current trends in retail shopping in the chart below.
Personal saving rates have declined significantly. The percentage of disposable income that people save was 2.4% in November, according to the U.S. Bureau of Economic Analysis. That’s down from an average of 6.3% pre-pandemic, according to S&P Global Market Intelligence, which crunched the numbers from 1991 to 2019.
The reality is that consumer spending throughout the 40-year high inflation rate in 2022 was flat – stagflation. Without any Fed or government stimulus and with the Fed’s recent hikes in rates, means that retailers and shoppers alike are heading for difficult times.
What about you – in the current economic environment, have you made any adjustments to your spending? Give us some ideas on what you see in the comment section below.
See more Chart of the Day posts.
By Tom Williams
Read Original Article on RightWireReport.com
