A Good Holiday Season In-store and Out
|GDP||2.9% pace in '18, up from 2.2% in '17 More »|
|Jobs||Unemployment rate down to 3.8% by end '18 More »|
|Interest rates||10-year T-notes at 3.0% by end '18 More »|
|Inflation||2.5% in '18, up from 2.1% in '17 More »|
|Business spending||Up 4% in '18, spurred by expanded tax breaks More »|
|Energy||Crude trading from $55 to $60 per barrel in April More »|
|Housing||Existing-home sales up 1.0%, new-home sales up 7.5% in '18 More »|
|Retail sales||Growing 4.7% in '18 (excluding gas) More »|
|Trade deficit||Widening 5%-6% in '18 More »|
Holiday sales surged 5.9% in 2017, the best season since 2005. Both in-store and out-of-store sales benefited from the consumer spending splurge. E-commerce and catalog sales picked up 13.6%, their best increase since 2014. In-store holiday sales also did well, rising 4.2%, their best upsurge since 2014.
2018 should be a good year for retail. Sales, excluding gasoline, will grow 4.7% — better than 2017’s 4.2% pace. Consumer wealth gains will lead to more home improvement projects and will keep building materials’ sales humming, with 8.9% growth, compared with 8.2% in 2017. Sales of all other goods will advance 4.6% in 2018, also a step-up from 2017’s 3.9% and the best growth in seven years. E-commerce will have yet another banner year, growing 16%, while in-store sales should do all right at 2.4%, their best showing since 2014.
Auto sales will be nearly flat after years of strong growth. The new tax law makes it easier for businesses to purchase motor vehicles, which will help the industry in a year that will see consumer demand ease.
Restaurant sales should rise 4.6% in 2018, a bit more than 2017’s 3.2%, as flush consumers typically eat out more when times are good. However, the restaurant boom of 2011-16 is likely over. Some chains will find expansion harder because of labor shortages, which will curtail sales increases. Higher minimum wages will boost menu prices.