US holiday sales growth to speed up as shoppers stay resilient, NRF forecasts

The US holiday sales growth is expected to accelerate to 4.2% this year, according to the National Retail Federation (NRF). NRF President and CEO Matthew Shay expressed confidence that consumers would remain resilient during the holiday season despite budget concerns. The forecast projects sales during November and December to rise to $1.013 trillion, up from 3.1% growth to $972 billion last year.

The NRF's projection is based on economic modeling incorporating consumer spending, employment, wages, and historical retail sales data, excluding automobile, gasoline, and restaurant sales.

The forecast takes into account higher household costs due to rising inflation, which have made shoppers more selective. Retailers like Walmart, Kohl’s, and American Eagle have indicated pressure on consumer spending ahead of the critical holiday period. A Deloitte survey of approximately 4,000 US consumers revealed that average household holiday spending could increase by 4% to $1,654 this year, driven by higher spending among Gen Z and millennial shoppers.

Deloitte also noted that consumers anticipate retail spending to rise by 10% to $988, while holiday activities spending is expected to fall 4% to $666. Notably, 79% of shoppers planning to gift an experience intend to pair it with a physical item.