Consumer sentiment keeps rising
An index of consumer sentiment rose for the fourth month in a row, gaining 5.8 points and reaching its highest level since last June. The Reuters/University of Michigan Consumer Sentiment Index hit 69.9 points in December, and researchers pointed to falling gasoline prices, mildly better employment prospects, an uptick in the stock market and real income growth.
IHS Global Insight is forecasting holiday retail sales to rise slightly less than 5.0% above last year’s sales of approximately $453 billion. (Holiday sales are defined as not seasonally adjusted November plus December total retail sales minus autos, gasoline, food services and non-store retailers.)
Retailers can expect strong holiday sales in the final stretch, according to the IHS forecast, although the consumer mood may sour if the political gridlock over the extension of the payroll tax cut and emergency unemployment benefits linger.