According to CNN Business and Mastercard SpendingPulse, year-over-year U.S. holiday spending grew at its fastest rate in six years. From November through Christmas Eve, Americans spent just more than $850 million, a 5.1% increase from the 2017 holidays. E-commerce sales also surged, with 19.1% more sales than in 2017. In fact, within the last year, mobile e-commerce holiday sales grew 57% from 2017 and in-store pickup sales grew 47%.
Last week, the Commerce Department’s retail spending report showed a notable gain in retail spending for the trailing twelve months through November, showing strong consumer demand heading into the holidays. Also, the Institute for Supply Management (ISM) released its semi-annual economic growth survey, revealing that although purchasing and supply managers expect revenue and investment growth, they believe 2019 will be a weaker year than 2018. Lastly, the Labor Department shared the November Consumer Price Index, which showed flat growth from October and a 2.2% annual increase. This week, the Federal Open Market Committee will meet on Tuesday and Wednesday to determine whether a rate hike is justified.
Last week, U.S. retail sales growth dramatically missed economists’ expectations for September, according to Commerce Department data. The Labor Department released their data from the August Job Openings and Labor Turnover Survey, indicating more than one job opening for every unemployed worker. Also, the Federal Open Market Committee shared the minutes from the end-of-September meeting, indicating a potential for interest rates to continue to rise.
Last week, data showed that retail spending declined in August, jobless claims rose for the week ending September 22nd, the personal consumption expenditures index hit the Fed’s targets, and consumer sentiment rose.
A larger jump in retail sales proved to be one of very few optimistic highlights in last week’s economic news. The week entailed mostly negative news, as housing starts increased less than expected, the Philly Fed’s Manufacturing Index slipped significantly, and the University of Michigan Consumer Sentiment Index fell unexpectedly.
Last week, reports from the Commerce Department and the National Association of Home Builders indicated the housing market is beginning to cool off. Also, the Department of Commerce released their U.S. retail sales report for the month of June, showing a slight increase in retail activity. Finally, on Thursday, the Department of Labor announced that weekly jobless claims reached their lowest level since 1969.
In a relatively slow week for economic news, retail sales reversed a downward trend and home buyers began shopping as weather improved. Yet, the markets paid close attention to the yield of the 10-year Treasury and its approach to 3%.
Four months into 2018 and more than 90 million square feet of retail space is set to close during the year. CoStar Group, which tracks square footage captured from retail store closings, has already noted 94 million square feet set to close in 2018, approximately 24 million of which is from the liquidation of more than 200 Bon-Ton stores.
Economic highlights from last week included:
First Data recently reported that retail spending increased 6.6% between October 28th and December 18th, compared to the same period of last year. The company also found that e-commerce sales continued to outpace traditional, brick and mortar retail stores, with increases of 11% and 5.4%, respectively.