Retail sales during 2020 will increase between 3.5 per cent and 4.1 per cent to more than $3.9 trillion despite uncertainty from the lingering trade war, the coronavirus outbreak and the presidential election, the US National Retail Federation (NRF) recently projected. “The nation’s record-long economic expansion is continuing, and consumers remain the drivers of that expansion,” NRF President and CEO Matthew Shay said.
Preliminary results show that retail sales during 2019 grew by 3.7 per cent over 2018 to $3.79 trillion, just short of NRF’s forecast of at least 3.8 per cent growth, which had to be based on incomplete data because of last year’s government shutdown.Retail sales during 2020 will rise between 3.5 per cent and 4.1 per cent to cross $3.9 trillion despite uncertainty from the lingering trade war, the coronavirus outbreak and the presidential election, the US National Retail Federation recently projected. The nation's record-long economic expansion is continuing, and consumers remain the drivers, it said.#
The total includes online and other non-store sales, which were up by 12.9 per cent at $777.3 billion, beating NRF’s forecast of up to 12 per cent growth. The numbers exclude automobile dealers, gasoline stations and restaurants.
“With gains in household income and wealth, lower interest rates and strong consumer confidence, we expect another healthy year ahead. There are always wild cards we cannot control like coronavirus and a politically charged election year. But when it comes to the fundamentals, our economy is sound and consumers continue to lead the way,” Shay said in a statement.
Based on the latest forecast, 2020 retail sales should total between $3.93 trillion and $3.95 trillion. Online sales, which are included in the total, are expected to grow between 12 per cent and 15 per cent to between $870.6 billion and $893.9 billion.
NRF expects the overall economy to gain between 150,000 and 170,000 jobs per month in 2020, compared with an average 175,000 in 2019, and that unemployment–currently at 3.6 per cent–should stay around 3.5 per cent. Gross domestic product is likely to grow 1.9 per cent, down from preliminary estimates of 2.3 per cent in 2019, NRF said.
“The economy is growing at a more modest pace, but the underlying economic fundamentals remain in place and are positive,” NRF chief economist Jack Kleinhenz said.
While consumers and small business owners are confident, Kleinhenz said corporate chief executives remain cautious over trade policy.
Further progress to build on the Phase One trade agreement with China could boost the economy and accelerate corporate spending and hiring. Conversely, escalation of the trade war could discourage corporate investments. Meanwhile, the wide range of potential policy outcomes associated with November’s elections could cause both consumers and businesses to be cautious.
The forecast assumes that coronavirus does not become a global pandemic, but business confidence and retail sales could be impacted if factory shutdowns in China continue, particularly if delivery of holiday season merchandise is affected.
Fibre2Fashion News Desk (DS)
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