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(Reuters) -U.S. holiday sales rose by 5.3%, but fell short of estimates, as shoppers feeling the brunt of stubbornly high inflation pulled forward purchases to October when retailers offered hefty discounts, data from the National Retail Federation (NRF) showed on Wednesday.
The leading retail industry group said including e-commerce, holiday sales which is not adjusted for inflation jumped to $936.3 billion during November and December. It had previously forecast a rise of between 6% and 8% over 2021 to between $942.6 billion and $960.4 billion.
NRF Chief Economist Jack Kleinhenz said due to inflation the amount of money spent on a budget were large for food and probably took away spending on other retail products during the holiday season.
In an attempt to exhaust excess inventories and bring back stocks to normal levels retailers including Amazon.com Inc (NASDAQ:AMZN), Target Corp (NYSE:TGT) and Walmart (NYSE:WMT) Inc offered discounts as early as October, which helped spur demand and lure in price sensitive consumers.
However, during the five-day long period between Thanksgiving and Cyber Monday, a record 196.7 million shoppers made purchases in stores and online, exceeding its expectations, according to the NRF.
Separately, the Commerce Department said on Wednesday that retail sales dropped 1.1% in December putting consumer spending and the overall economy on a weaker growth path heading into 2023.
“I do see slower momentum into 2023… given what we have just seen in the last three months I still think that the consumer is engaged… but there is a lot of uncertainty,” Kleinhenz added.
According to the NRF, online and other non-store sales were up 9.5% at $261.6 billion, which fell short of its forecast of a 10% to 12% growth.
During the holiday period, furniture and home furnishings stores saw sales drop 1.1%, while electronics and appliance sales fell 5.7% – the only two categories that saw a decline in the season.
