US Holiday Sales Expected to Grow 5.7%

Total US holiday retail sales are projected to grow by 5.7 percent over last holiday season, bringing holiday spending to $217.4 billion, says the National Retail Federation.

“After several strong months of retail sales growth, it seems clear that the economy is picking up momentum just in time for the holidays,” said NRF Chief Economist Rosalind Wells. “Retail sales gains for the 2003 holiday season will be far better than the meager increases retailers experienced a year ago.” Holiday sales in 2002 increased 2.2 percent to $205.6 billion.

Wells cites a variety of factors for this holiday’s substantial sales increase, including low interest rates, low inflation, rising equity markets, and mounting consumer confidence. Also, she said, consumers have more disposable income resulting from the withholding tax cut and child tax credit checks.

Additionally, business spending is a major factor contributing to this year’s holiday forecast. Retail spending by businesses on equipment and software jumped 8.0 percent at an annual rate in the second quarter following an extended period of weakness going back to 2000.