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Report: Holiday spending predicted flat with last year


New York City With consumers still reeling from the toughest economic pressures in decades, retailers should expect sales to remain flat compared with the 2008 holiday shopping season, according to a Deloitte forecast released Sunday.

“Although there are signs that suggest the economy is nearing the end of its darkest days, many consumers remain burdened by restricted credit availability, high unemployment and foreclosures," said Carl Steidtmann, chief economist with Deloitte Research, a subsidiary of Deloitte Services LP. "Americans continue to save at historically high rates while also paying down debt, and these factors combined suggest another chilly holiday season for retailers."

Deloitte's Retail group expects total holiday sales to reach $810 billion, excluding motor vehicles and gasoline, which would represent a 0% change in November through January holiday sales over last year. But it would also be an improvement over last season's 2.4% decrease, the first decline in holiday sales according to Deloitte's analysis of Commerce Department data dating back to 1967.

"We are seeing certain economic indicators move in the right direction," said Steidtmann. "These small improvements are part of the reason that retailers may avoid another negative season."

A growing opportunity for retailers is the surge in consumers who are embracing the digital age, according to Deloitte.

“Retailers that can harness the power of technology likely have a better chance of engaging those consumers who are willing to spend,” said Stacy Janiak, vice chairman and U.S. Retail leader, Deloitte LLP. The proliferation of mobile applications and social networks may yield new opportunities to pursue targeted advertising, build brand loyalty and measure campaign effectiveness."

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