BENGALURU (Nov 23): US holiday sales are expected to rise up to 5.2% in 2020, the National Retail Federation (NRF) said on Monday, as Americans look to spend more on gifts during the festive period, while Covid-19 cases rise.
The US retail group forecast sales, which exclude automobile dealers, gasoline stations and restaurants, to grow between 3.6% and 5.2% or between US$755.3 billion and US$766.7 billion, compared with the 4% growth last year.
The NRF said reduced spending on personal services, travel and entertainment during the health crisis has freed up money for retail spending.
"Given the pandemic, there is uncertainty about consumers' willingness to spend, but with the economy improving most have the ability to spend," NRF Chief Economist Jack Kleinhenz said.
The upbeat forecast comes after major US retailers moved their promotions up to as early as October and indicated that their holiday sales will be spread out over more days.
"Consumers have shown they are excited about the holidays and are willing to spend on gifts that lift the spirits of family and friends, after such a challenging year," NRF Chief Executive Officer Mathew Shay said.
The trade body forecast online sales and other non-store sales to increase between 20% and 30% to between US$202.5 billion and US$218.4 billion, up from US$168.7 billion last year.
Retail chains have been doubling down on their investments in e-commerce, as people staying at home due to the outbreak favour curbside pickup and delivery options.
The NRF's numbers, usually published in October, have been delayed this year due to the health crisis. Its forecast is one of the most closely-watched benchmarks ahead of the holiday season, when retailers such as Walmart Inc and Target Corp generate an outsized portion of their profit and sales.