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US Holiday Sales Expected To Grow, Retailers Ready Promotions

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US Holiday Sales Expected To Grow, Retailers Ready Promotions

What’s going on here?

US retail sales are expected to rise by 3.2% this holiday season, according to Mastercard’s latest forecast, leading retailers like Walmart and Amazon to ramp up their promotions for budget-conscious shoppers.

What does this mean?

Mastercard predicts this year’s holiday sales will see slightly better growth than last year’s 3.1% increase. Its SpendingPulse report, which tracks in-store and online retail sales across all forms of payment (excluding automotive), indicates a strong season ahead for retailers. With only 27 days between Thanksgiving and Christmas, retailers might start their holiday promotions earlier than usual. By offering aggressive discounts, companies like Walmart, Target, Amazon, Shein, and Temu are gearing up to attract thrifty shoppers who are now more expectant of price cuts amid cooling inflation. Moreover, online sales are set to jump by 7.1%, while spending on big-ticket electronics could surge by 6.7%, driven by lower borrowing costs and the need to replace gadgets purchased during the pandemic.

Why should I care?

For markets: Discount days are here.

Retail stocks could see some movement with the anticipated surge in holiday sales. Retailers are responding with hefty promotions, hoping to capture the wallets of budget-savvy shoppers. While the Federal Reserve’s recent 50 basis points interest rate cut aims to ease financial pressures, it’s worth noting that Deloitte’s forecast still sees this holiday sales growth as the slowest in six years. Yet, the combination of strong online sales and a robust labor market should support retail sector optimism.

For you: Deals on the horizon.

If you’ve got your eye on those expensive electronics, this could be the perfect time to buy. Lower borrowing costs, price cuts, and the latest in tech innovation will likely make this holiday season a prime time for scoring deals on big-ticket items like televisions and laptops. Keep an eye out for early promotions from retailers such as Best Buy, which is already planning to launch its holiday promotions by the end of the month.

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