📝 See Holiday Sales Rising 6% This Year: Wells Fargo

There hasn’t been a “normal” holiday shopping season since 2019 and make no mistake, retailers wouldn’t have it any other way. Despite all the challenges of securing inventory amid supply-chain congestion and finding staff despite a tight labor market, stores have been raking it in the past couple of years. In fact, looking back over the past 28 years, the two biggest annual increases in holiday sales have occurred in each of the past two years.

Our forecast anticipates holiday sales will increase 6% this year, which if realized would be above the long-run average of 4.6% . That may be an unexpectedly upbeat forecast from the same people who are calling for a recession to take hold in 2023, but our holiday sales call says as much about what has already occurred this year as it does about what is ahead in the remaining months of it. The fact is: the uncanny staying power of the consumer in the first nine months of the year puts us on track for a solid out turn, even if sales finish the year with a thud as they did last year with a very disappointing December. Our 6% annual forecast implies just that; below-average sales growth in October and November, followed by a weak December. Make no mistake, we still anticipate that consumer staying power will run out by early next year and that retrenchment in consumer spending will play a key role in the broader recession we expect to take hold. This report makes the case for why this holiday shopping season will represent the Last Hurrah for this economic cycle. - Wells Fargo