Stay updated with complimentary updates
Just sign up for the US economy myFT Digest and receive it straight to your email inbox.
US retailers are prolonging their traditional one-day Black Friday sales into multi-week events to entice American consumers to continue spending, as data indicates a slowdown in their spending spree that has been driving economic growth.
Major retailers like Walmart, Amazon, Target, and Macy’s have already started offering significant discounts under the Black Friday banner well in advance of the actual day this week.
Despite these efforts, general merchandise sales were down 3% year-on-year in the week ending November 16, according to data from Circana, a retail point-of-sale data aggregator.
The National Retail Federation predicts that winter holiday sales in the US will nearly reach $1 trillion in November and December, with an average of $902 per person. However, the growth rate is expected to be around 2.5-3.5%, the slowest since 2018.
“Retailers are extending incentives to attract more consumers over a wider period,” said Gregory Daco, chief economist at EY Parthenon. “This holiday season is likely to see subdued sales due to moderate volume growth and decreased pricing power.”
Consumer spending has been a key driver of America’s strong economic growth in recent months. However, consumer confidence remains below average, according to sentiment surveys.
The possibility of new tariffs under the incoming administration raises concerns about inflation, which could impact consumer sentiment negatively.
“Donald Trump’s return to the White House with a Republican majority is likely to lead to higher inflation, slower GDP growth, and increased budget deficits,” noted Roland Fumasi, a food and agribusiness analyst at Rabobank.
If Trump imposes new tariffs, it could result in increased inflation and slower economic growth, although tax cuts and deregulation by a Republican Congress could mitigate the impact.
Black Friday is a crucial time for retailers, with the period between Thanksgiving and Cyber Monday being vital for annual revenue.
NRF chief economist Jack Kleinhenz mentioned that households’ finances are in good shape, which could drive strong spending during the holiday season, although consumers may be more cautious with their spending.
Target CEO Brian Cornell mentioned that consumers are becoming more strategic in their shopping habits, focusing on deals and stocking up when they find them.
Target recently ran an “Early Black Friday” promotion and launched a “Black Friday deals” promotion that will run until the end of the month, featuring discounts on various items.
Walmart and Amazon have also started their Black Friday promotions earlier this year to attract shoppers.
Additional reporting by Will Schmitt in New York and Madeleine Speed in London
sentence: Please make sure that you turn off the lights before leaving the room.
Ensure that you switch off the lights before exiting the room.