Rich shoppers seen boosting U.S. holidays, deep discounts likely

and this is an example of why economic indicators can be so misleading:



Wealthier U.S. shoppers are likely to drive the most bountiful holiday season in three years as retailers slash prices to cope with tighter budgets, analysts said on Tuesday, as a new survey showed 2014 retail sales rising 4.1 percent.

The National Retail Federation predicted retail sales would climb to $616.9 billion, outpacing last year's 3.1 percent growth. Sales rose more than 5 percent in 2010 and 2011, and 3.5 percent in 2012, and growth averaged 2.9 percent over the past decade, NRF said.

The group's forecast is one of the closely watched benchmarks ahead of the holiday season, which can account for 20 to 40 percent of annual sales for many retailers.

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About 41 percent of shoppers will increase their online spending in 2014, PwC said on Tuesday. But 72 percent of households expect to spend $684 this holiday season, down from $735 in 2013, it added.

NRF's Shop.org division forecast an 8 to 11 percent growth in online holiday sales to as much as $105 billion. Year-ago figures were not immediately available.

The holiday season is a major U.S. economic growth marker, as consumer spending accounts for about 70 percent of Gross Domestic Product.


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