US to focus on prosperity not politics
Ensure
US economy from
Artificial
problems like trade wars!
Forecasts
retail sales growth
Between
3.8 and 4.4 Percent
The
National Retail Federation (NRF) forecast that retail sales during 2019 will
increase between 3.8 percent and 4.4 percent to more than $3.8 trillion despite
threats from an ongoing trade war, the volatile stock market and the effects of
the government shutdown.
“We
believe the underlying state of the economy is sound,” NRF President and CEO
Matthew Shay said. “More people are working, they’re making more money, their
taxes are lower and their confidence remains high. The biggest priority is to
ensure that our economy continues to grow and to avoid self-inflicted wounds.
It’s time for artificial problems like trade wars and shutdowns to end, and to
focus on prosperity not politics.”
Preliminary
estimates show that retail sales during 2018 grew 4.6 percent over 2017 to
$3.68 trillion, exceeding NRF’s forecast of at least 4.5 percent growth. The
number includes online and other non-store sales, which were up 10.4 percent at
$682.8 billion. That met NRF’s forecast of 10-12 percent online growth, and
online is expected to grow in the same 10-12 percent range again this year. The
numbers exclude automobile dealers, gasoline stations and restaurants.
Growth
of between 3.8 percent and 4.4 percent would result in total 2019 retail sales
of between $3.82 trillion and $3.84 trillion. Based on growth of 10-12 percent,
online sales would total between $751.1 billion and $764.8 billion, which are
included in the total.
The
2018 results are based on Commerce Department data up through November but
include NRF estimates for December because the agency was closed during the recent
government shutdown and has not yet released December figures. The results are
subject to revision once December numbers become available, and government
numbers are revised again each spring regardless of the shutdown.
“We
are not seeing any deterioration in the financial health of the consumer,” NRF
Chief Economist Jack Kleinhenz said. “Consumers are in better shape than any
time in the last few years. Most important for the year ahead will be the
ongoing strength in the job market, which will support the consumer income and
spending that are both key drivers of the economy. The bottom line is that the
economy is in a good place despite the ups and downs of the stock market and
other uncertainties. Growth remains solid.”
NRF
expects the overall economy to gain an average of 170,000 jobs per month, down
from 220,000 in 2018, and that unemployment – currently at 4 percent – will
drop to 3.5 percent by the end of the year. Gross domestic product is likely to
grow about 2.5 percent over 2018.
Kleinhenz
said inflation and interest rates are expected to remain low this year and that
retail sales have been helped by recent reductions in gasoline prices.
Retailers
so far have been able to largely mitigate the impact of new tariffs from China
imposed in the past year. But tariffs could drive up the cost of consumer
products and affect business direction and profits this year, particularly if
tariffs on $200 billion in Chinese products rise from 10 percent to 25 percent
as currently scheduled for March 1, he said.
It
has been difficult to measure the impact of the recently ended government
shutdown. Government workers will be paid retroactively but some spending and
expenses such as dining out or entertaining have been lost and government
contractors will not receive back pay, Kleinhenz said. A key issue is how
quickly the Internal Revenue Service will be able to process a potential
backlog of tax returns, which would affect first-quarter spending, he said.
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