US Consumer Sentiment To Drive Holiday Season

Forbes 3 weeks ago

As we head closer to the holiday peak, are US shoppers ready to spend? So far this year, retail sales growth trends have been inconsistent, with weakness in several months balanced by strength in others. At Prosper, each month we survey 7500 consumers on sentiment, behavior and preferences. Like retail sales, our key confidence metric has seesawed month by month this year.

In order to make more sense of these up and down metrics, I asked Deb Weinswig and her team at Coresight Research to analyze Prosper’s October data particularly on consumer sentiment and future purchase intentions and identify any trends that may be forming.  Here is what they found.

In October, US consumer confidence levels were up month over month, with the proportion of all consumers being confident or very confident in the economy standing at 50.7% versus 49.7% in September. However, that improvement followed two months of confidence declines, and affluent consumers—those with household incomes of more than $150,000—registered a further month-over-month slowdown in confidence in October.

Over the medium term, the picture is mixed. Confidence levels have zig-zagged so far this year—but compared to January’s trough, consumer sentiment is up. And that recovery has been led by more affluent households. Versus January, confidence levels in October were up 2.1 percentage points for all adults but were up 3.8 points for those with a household income of over $100,000 and up 5.3 points for those with an income of over $150,000.

We chart the pattern in total retail sales below.

Deborah Weinswig, CEO Coresight Research, says, “The economic context for US consumers is generally benign—but there are pockets of macro uncertainty and this appears to have weighed on consumers. Retail sales growth has strengthened recently, but the previous inconsistency in retail demand and upward pressures on costs, particularly from increased tariffs on certain imports from China, may prompt some caution among retailers.”

Prosper’s October data shows that a recovery in confidence in the stock market has contributed to the overall uptick in sentiment among affluent shoppers—although that stock-market confidence tended to falter in September and October. Compared to January, willingness to invest in the stock market in October was up 1.9 percentage points for all adults, 3.0 points for $100,000+ and 2.3 points for $150,000+.

So, how does this translate into willingness to spend? Below, we compare the percentage-point change in major purchase plans between January and October. It’s worth noting that some purchase categories, notably vacations, are more seasonal—and the most interesting comparisons are between the income groups, rather than the overall change.

Those with incomes over $100,000 have registered a greater-than-average increase in spending intent for the furniture, home appliance, house and jewelry/watch categories. Those with incomes over $150,000 have outpaced the average on plans to spend on home appliances, major home improvements, house purchases and jewelry or watches. Affluent shoppers’ willingness to spend on big-ticket categories is a positive, despite the inconsistent retail context: Worried consumers are most likely to cut back on big-ticket discretionary categories.


Source link
Read also:
Reuters › Finance › 1 month ago
British consumer sentiment has fallen to a six-year low due to increased worries about job security and the impact trade tensions and political uncertainty will have on individuals' finances, a survey showed on Thursday.
The New York Times › Finance › 1 month ago
Irish consumer sentiment weakened for the third month in a row in September as the failure of the UK and the European Union to agree divorce terms ahead of the Oct. 31 Brexit date increased worries about the outlook for the Irish economy.
CNBC › 3 weeks ago
Coca-Cola CEO James Quincey said that if U.K. lawmakers passes a Brexit deal, consumer sentiment will improve.
One America News Network › Finance › 2 weeks ago
By David Milliken LONDON (Reuters) - Britain's longest-running measure of consumer sentiment slipped back to its joint-lowest level since 2013 this month, as Brexit uncertainty weighed again on
Reuters › Finance › 1 week ago
Irish consumer sentiment fell for a fourth successive month for the first time since late 2012 as uncertainty over neighboring Britain's departure from the European Union continued to weigh on confidence, a survey showed on Tuesday.
CNBC › 6 days ago
We'll get Disney earnings after the bell on Thursday, consumer sentiment data and markets update on Friday.
Breitbart › Finance › 5 days ago
Consumer sentiment is up for the third consecutive month. | Economy
Business Insider › Finance › 1 month ago
New data on Monday showed that Germany's composite PMI sank to its lowest level since October 2012. And sentiment among manufacturers fell to a 2009 low. The PMI is the yardstick used to measure business sentiment. The service sector also lost momentum...
Business Insider › Lifestyle › 1 month ago
You can access your iCloud Drive on an iPhone through the Files app. You'll first have to set up iCloud Drive on your iPhone, and then you'll be able to access all of your documents stored in iCloud Drive through the Files app. iCloud Drive allows you...
Business Insider › Lifestyle › 1 month ago
The holiday season is almost here and that means you can already find holiday-ready gift sets at many of your favorite retailers. Sephora always releases a host of value sets and limited-edition beauty products each holiday season. This year, we poured...
Sign In

Sign in to follow sources and tags you love, and get personalized stories.

Continue with Google
OR