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Report: Key indicators point to positive holiday season for retailers

A combination of factors are expected to boost U.S. holiday sales this year.

With unemployment at its lowest rate in 17 years, consumer sentiment up four points over 2016 levels, and one extra shopping day between Thanksgiving and Christmas this year, global think tank FGRT (Fung Global Retail & Technology) remains optimistic that U.S. holiday sales will increase by 3% to 4% over 2016 results. That is well above the average 2.6% increase over the past 10 years, according to FGRT's new report "Deep Dive: Holiday 2017-All Signs Point to 'Shop!'"

E-commerce will take an ever-growing share of those sales, continuing its year-long acceleration. Online sales accounted for nearly 9% of overall sales in the third quarter of 2017, FGRT reported.

Tech products likely will be a major gift category this year, driven by Apple's new iPhone X and related accessories, declining prices for 4K TVs, and intelligent speakers, according to FGRT managing director Deborah Weinswig.

"Technology gifts are no longer just for tech lovers; rather, they have become essential appliances and cornerstones of our culture," Weinswig wrote in the report. "Also driving sales this holiday will be merchandise and promotions related to the release of the newest "Star Wars" movie, "The Last Jedi."

Apparel gifts also will feature prominently on shoppers' lists, she added, with items from Gucci (and more affordable versions from H&M and Zara), Coach and Gap likely to be popular. Vintage looks, especially 1960s-inspired pieces such as short ankle boots and bell bottoms, also will appeal to consumers.

Other factors that should encourage sales increases this year include cooler weather in November and December compared with 2016, which should boost seasonal apparel. Also, easier year-over-year sales comparisons due to last year's traffic dip prior to the U.S. presidential election.

"With that behind us, shoppers now have an idea of the White House agenda, and its pro-business sentiment has accompanied a run in stock markets worldwide, again leading consumers to feel more affluent," Weinswig wrote. "Sales performance for this holiday season is likely to meet or even exceed our estimates."
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