U.S. consumer spending during the Christmas season exceeded projections and remained robust despite persistently high inflation this year, even if the growth was smaller than the 8.5% increase in December 2021.
There was a noticeable increase of 4.4% in the apparel/clothing sector, a modest gain of 1.0% in department shops, and a massive increase of 15.1% in restaurants from the previous year, as people continued to love dining out with their coworkers, friends, and family during the holidays. Sales of jewellery (-5.4%) and electronics (-5.3%) fell from 2020 and 2022. While holiday sales data does include other retail categories, auto sales are not one of them.
The data showed that the clothing and accessories sector increased by 4.4%, department stores by 1.0%, and restaurants by a staggering 15.1% Year-Over-Year, as individuals continued to love eating out with coworkers, friends, and family throughout the holidays. Demand for jewellery (-5.4%) and electronics (-5.3%) fell between 2021 and 2022. Conversely, vehicle sales are not accounted for in the holiday sales figures.
Due to rising prices brought on by inflation, Americans spent more than usual on gifts and meals throughout the holiday season this year.
The Mastercard Spending Pulse, which tracks purchases made with Mastercard, reported on Monday that retail sales in the United States rose 7.6 percent from November 1 to December 24 compared to the corresponding period in 2017. The index follows the total amount of money exchanged for goods and services in stores and on the internet, excluding automobiles, regardless of the method of payment used.
After a decrease in US retail sales in November due to reduced consumer spending—despite a healthy Black Friday turnout—this data is good news. The fact remains, though, that inflation explains a sizable portion of the holiday shopping spree’s yearly growth.
According to data released by the Commerce Department on Friday, the price index for personal consumption expenditures grew 5.5% in November compared to the same month a year ago.
Consumers and merchants “navigated the season well,” according to Michelle Meyer, North America Chief Economist at the Mastercard Economics Institute.
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