It could be a jolly holiday season for retailers if the holiday sales forecast from the National Retail Federation proves accurate.
The NRF said it expects retail sales in November and December to increase between 3.6% and 4% for a total of $678.75 billion to $682 billion, up from $655.8 billion in 2016.
Christmas falls 32 days after Thanksgiving this year, one day more than last year, and is on a Monday instead of Sunday, giving consumers an extra weekend day to complete their shopping.
“Our forecast reflects the very realistic steady momentum of the economy and overall strength of the industry,” said Matthew Shay, NRF president and CEO. “Although this year hasn’t been perfect, especially with the recent devastating hurricanes, we believe that a longer shopping season and strong consumer confidence will deliver retailers a strong holiday season.”
This year’s forecast would meet or exceed last year’s growth of 3.6% and the five-year average of 3.5%. While recent hurricanes are not expected to have a significant long-term effect on the economy, NRF is issuing this year’s forecast as a range rather than the usual fixed percentage because the impact of the storms on economic indicators has made it difficult to make a more precise forecast.
“Consumers continue to do the heavy lifting in supporting our economy, and all the fundamentals are aligned for them to continue doing so during the holidays,” said Jack Kleinhenz, NRF chief economist. “The combination of job creation, improved wages, tame inflation and an increase in net worth all provide the capacity and the confidence to spend.”
To more accurately capture the entirety of spending on Thanksgiving weekend, NRF this year will release spending data on November 28, the day after Cyber Monday. This will allow the NRF to provide a more accurate picture of consumer activity over the entire weekend and incorporate Cyber Monday data into the results, officials said.