“U.S. consumers have pulled back on purchases and limited holiday shopping in recent weeks as the coronavirus pandemic triggered new business restrictions, potentially snapping a six-month stretch of retail sales growth,” WSJ writes.
Why It Matters: If retail sales follow WSJ’s projections of a 0.3% decline in November, then it would mark the first month-over-month drop since April. It’s just another indicator of the slowing economic recovery as the U.S. economy prepares to bear down for another prolonged shutdown. The full data will be released later today.
- Hiring growth also slowed in November, while jobless claims recently ticked up.
- Overall consumer spending remains on the rise, but at a much slower pace than the summer.
- Consumer confidence has been mixed, though WSJ cites one survey, “reflecting a brighter outlook for the economy beyond the pandemic.”
Numbers To Consider:
- Average spending between Thanksgiving and Cyber Monday this year was $312, a 14% decline from 2019, according to a survey by the National Retail Federation and Prosper Insights & Analytics.
- JPMorgan Chase’s tracking of 30 million credit and debit cardholders showed a 4.1% decrease in spending from the year before the week through Dec. 11.
- Overall spending fell 11.6% for the week ending Nov. 29 compared with January levels, according to data collected by Affinity Solutions and Opportunity Insights.
The Takeaway: Some retailers have reaped the rewards of the e-commerce boom, performing better than businesses heavily reliant on physical shopping. At this point, recovery is contingent on how serious the rise of Covid-19 infections proves to be, how quickly the vaccine can be distributed widely and whether the government can provide some form of fiscal stimulus.