Visa reported today that overall holiday retail sales are up 4.8%, as of the end of last week.
U.S. retail sales are up 4.8% days before the end of the holiday season, Visa preliminary data shows.
The data, from Visa’s Retail Spend Monitor, reflect spending during the first seven weeks of the holiday season, and covers all forms of payment, including credit cards, cash, and checks. It excludes auto, gasoline, restaurants and other categories. It is not adjusted for inflation.
The preliminary numbers indicate a healthy level of consumer confidence, Wayne Best, chief economist at Visa, said in an interview.
Strong Lift For In-Store Spending
Consumers are confident not only about the economy but also about their ability to go out and shop in-person, Best said.
Visa found strong growth in the in-store spending category, with total retail spending in stores up 4.1% year-over-year, compared to 1.6% in 2023.
“That 4.1 is quite of a bit of an uplift than what we saw last holiday season,” Best said. “I think that speaks broadly for, first off the confidence of the consumer. They’re feeling more comfortable. They’re feeling comfortable about the environment, the economy, etc and as a result feel more inclined to be able to go out shopping.”
“That’s an important element that frankly I haven’t seen really since Covid,” he said.
In-store spending still accounts for more than three-fourths of retail spending during the holiday months. Visa found that 77% of total payments occurred in stores during the seven week period, versus 23% online.
Online retail spending increased by 7.1%, smaller growth than last year’s 10.3% increase.
Concern About Tariffs Lifts Appliance Sales
The Visa report found that sales of durable goods and items like appliances and electronics increased significantly.
Best noted that University of Michigan data showed that the number of consumers who said they believe prices on those items will increase, making this a good time to buy major items, jumped from 20% in October to 40% in November.
“This is appliances, washers, dryers, ovens, refrigerators,” Best said. “If we look at the data those were categories that had a very strong increase starting in November and we believe that continued in December.”
“Some of that’s related, very likely, to the concern related to the potential for tariffs,” and the uncertainty about possible price increases, he said.
The building materials category, which includes home improvement stores, had growth of 4.7%, compared to a decline of 3.9% in 2023.
Visa’s Retail Spend Monitor report is produced by Visa Consulting and Analytics, a global network of consultants, economists and data scientists. It reflects both Visa payments data and all other forms of payment, using survey-based estimates for other forms of payment.
Most pre-holiday forecasts predicted holiday retail sales growth of below 4%. The National Retail Federation in October predicted holiday growth of between 2.5% and 3.5%.
The NRF said recently that based on the Census Bureau’s figures for November, consumers are on track to easily meet that forecast.