Holiday Sales Topped Expectations. That Could Mean a Strong Start to 2025 | Global News Avenue

Retailers are having a blast with gift-giving this season.

According to the National Retail Federation, consumer spending was $994.1 billion in the final two months of 2024, exceeding the trade group’s forecast of $97.95 to $989 billion. “Core” retail sales (all goods except gas, automobiles and restaurant purchases) increased 4% from the 2023 holiday season, also higher than NRF’s forecast, according to an NRF analysis of U.S. Census Bureau data.

The NRF said the holidays capped a year in which Americans spent a record $5.28 trillion. The organization’s analysis is not adjusted for inflation.

“The pace of spending is back to pre-pandemic growth levels, which bodes well for a good start to the year ahead,” said Jack Kleinhenz, NRF chief economist.

Business is growing year over year in most categories tracked by NRF. The organization said Americans spent 5.6% more at furniture and home improvement stores compared with November and December last year. Sales at electronics and appliance stores rose 3.7%, the NRF said.

NRF said nearly 30% of seasonal spending ($296.7 billion) occurs online or outside of brick-and-mortar stores. Digital shopping surges, Several analysts said buying activity at brick-and-mortar stores was less active.

Kleinz said Americans are more comfortable spending because inflation has fallen since last winter. The consumer price index rose 2.7% year-on-year in November Growth in December was 2.9%, But the estimated cost of living increase in late 2023 is even more significant, according to the U.S. Bureau of Labor Statistics.

Still, some Americans are increasingly concerned that inflation will rise again, and Consumer confidence fell in January. Kleinz said saving money remains a top priority for many people.

“While consumers remain relatively healthy and are spending significantly more, they remain budget-conscious,” he said.

NRF’s analysis comes as the Census Bureau releases retail sales data for December, which shows U.S. consumers are cutting wood Sales growth slowed slightly Compared with November levels, it was higher than expected.