November Retail Sales Show Strong Start to Holiday Season

November retail sales were up 0.7 percent seasonally adjusted from October and increased 5 percent unadjusted year-over-year, completing the first half of the holiday shopping season with spending on track to easily meet the National Retail Federation’s forecast, NRF said today. The numbers exclude automobiles, gasoline stations and restaurants. NRF’s forecast predicts that holiday retail sales during November and December will increase between 4.3 and 4.8 percent over the same period in 2017 for a total between $717.45 billion and $720.89 billion.

Total Retail's Take: The strong start to the holiday shopping season is welcome news to retailers. The growth in retail sales in November were driven in large part online, as e-commerce sales were up 12.1 percent year-over-year and up 2.3 percent month-over-month seasonally adjusted. And the outlook looks positive for the momentum to carry into December and then 2019. The NRF cited stronger employment rates, improved wages, tax cuts and increased net worth as reasons for increased consumer spending, and that's expected to continue for the foreseeable future. While sales are up, the real measure for retailers will be their bottom lines following the holiday season. With increased discounting and free shipping almost mandatory to remain competitive, retailers' margins are tested during the holiday season.