Moody’s: Holiday sales to be lackluster, with online sales a bright spot

New York City -- Holiday sales growth will lag behind last year’s robust gains as consumers hold back in an uncertain economy. The roughly 3% growth will be driven by high prices due to inflation, rather than any increase in demand, according to a new report by Moody's Investors Service.



"Consumer confidence is bruised by ongoing downbeat headlines, as well as potential gridlock ahead of the deficit-reduction plan expected on November 23, close to the traditional kickoff of the holiday shopping season, Black Friday," said Maggie Taylor, a Moody's VP and senior credit officer. "However, online spending will be the one bright spot as consumers, enticed by convenience and bargains will drive spending up by nearly 15% compared to last year."



The report notes that best-performing segments will be toys, electronics, party goods and "value" positioned retailers including gaming retailer GameStop and party supplier Party City but apparel companies will continue to feel pressure as consumers balk at higher prices.



To see the full report "US Retail: Here Come the Ho-Hum Holidays," click here.