YONKERS, N.Y. Despite lackluster retail numbers since August, consumers have increased their retail spending markedly in November and the outlook for planned purchasing in December is strong, according to the Consumer Reports Index's Dec. 2009 report.
The Consumer Reports past 30-day retail index (purchases made in November) has risen 24%, climbing to 11.2 percentage points from 9 percentage points last month. The outlook for planned purchases in the next 30 days is at 12.2 percentage points, an increase of 36%. The report indicates that major gains in retail spending are led by personal electronics, major electronics and small appliance purchasing.
"Despite the fact that the average consumer has not experienced much improvement in their financial lives in the past six months, they appear to be buying more for the holidays," said Ed Farrell, a director of the Consumer Reports National Research Center.
In light of the scores for consumer sentiment, stress and consumer trouble levels, this can be best described as a reluctant rally. Consumer sentiment remains low and relatively steady over the past three months. It stands at 41.8 in December, down slightly from 42.2 in November.
"The outlook is for a long-drawn-out period of discomfort for consumers. Though growth has returned to the Retail Index this month, it is possible that we will see a sharp decline below pre-holiday levels as consumers recover from their splurge, and face increased debt," Farrell said.