The U.S. Census Bureau today confirmed that holiday sales beat all expectations.
Holiday sales jumped 5.5 percent compared to past year, marking the largest jump seen since the end of the Great Recession, the National Retail Federation said on Friday.
Electronics and appliance stores increased 6.7% unadjusted year-over-year. However, many questioned exactly where that increased spending would go. Those categories related to home fared best, with building materials and supplies stores and furniture and furnishings retailers seeing a 9.9% bounce.
Clothing and accessories stores were up 2.7 percent.
December alone was up 0.4% seasonally adjusted from November and up 4.6% unadjusted year-over-year.
Core retail sales - excluding automobiles and parts - grew 0.4%.
At the same time, NRF had forecast non-store sales growth, which includes online revenue, would come in between 11% and 15% to between $137.7 billion and $142.6 billion.
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Holiday sales from November 1 through December 31 rose 5.5 percent over the same period in 2016, to $691.9 billion.
Overall December sales - including automobiles, gasoline and restaurants - were up 5.5 percent from December 2016.
While strong sales were widely expected, many retailers were particularly hungry to prove themselves this past holiday season, following a year marred by tumbling stock prices, management shakeups, a slew of store closures and several industry bankruptcies.
"The basic story line here is that holiday sales were extremely strong, " said Chris Christopher, executive director of research firm IHS Markit. "Today's strong report raised our estimate of Q4 GDP growth three-tenths to 2.6% (revised up further to 2.7% after folding in this morning's CPI report) and our forecast of Q1 GDP growth two-tenths to 2.4%". Nonstore retailer sales are up 12.7% year-over-year as online retailers continue to grow their market share.
Several large US employers, including Walmart, American Airlines Group Inc, AT&T Inc and Wells Fargo & Co, have announced employee bonuses or wage increases after US President Donald Trump's tax overhaul in December cut the corporate tax rate to 21 per cent from 35 per cent.
"The economy was in great shape going into the holiday season, and retailers had the right mix of inventory, pricing and staffing to help them connect with shoppers very efficiently", Kleinhenz said.
These factors along with recent legislation have the NRF bullish on 2018. "Whether they shopped in-store, online or on their phones, consumers were in the mood to spend, and retailers were there to offer them good value for their money".