Connect with us

Headlines

Economy’s ‘Great Uncertainty’ Is Now a Clear Recovery, Says NRF Expert

The NRF has revised its retail sales forecast upward.

mm

Published

on

WASHINGTON – As retailers head into the second half of 2021, the “great uncertainty” that clouded the nation’s economic outlook earlier in the year has transformed into evidence of an unprecedented recovery from the COVID-19 pandemic, says an expert from the National Retail Federation.

“It has become clear that the U.S. economy and retail sales are growing far faster and more steadily than anyone could have expected just a few months ago,” said NRF Chief Economist Jack Kleinhenz. “We are seeing not just unprecedented growth from months of pent-up demand as the economy reopens but momentum as well.”

18 New Men’s Jewels Your Clients Will Love [Photo Gallery]
Photo Gallery

18 New Men’s Jewels Your Clients Will Love [Photo Gallery]

18 New Rings Your Customers Will Love [Photo Gallery]
Photo Gallery

18 New Rings Your Customers Will Love [Photo Gallery]

The Film <em>Spencer</em>, a Biopic of a Challenging Time in Princess Diana’s Life, Stars Kristen Stewart and Mouawad Jewels
Celebrity Jewelry

The Film Spencer, a Biopic of a Challenging Time in Princess Diana’s Life, Stars Kristen Stewart and Mouawad Jewels

Kleinhenz’s remarks came in the July issue of NRF’s Monthly Economic Review, which expanded on the reasoning behind the revised forecast NRF issued on June 9 as part of its inaugural State of Retail and the Consumer event. NRF now expects retail sales during 2021 to grow between 10.5 and 13.5 percent over 2020, to a range between $4.44 trillion and $4.56 trillion. That compares with the initial forecast released in February of between 6.5 percent and 8.2 percent growth and a total between $4.33 trillion and $4.4 trillion.

“Our initial forecast was made when there was still great uncertainty about consumer spending, vaccine distribution, virus infection rates and additional fiscal stimulus,” Kleinhenz said. “Since then, we have seen spending grow, vaccines have become available to virtually anyone who wants one, infections have fallen and additional stimulus in the form of the American Rescue Plan has been signed into law.”

Revising the forecast is something NRF doesn’t take lightly because ups and downs in monthly retail sales figures coupled with multiple revisions and long lags before the data becomes final make it “difficult to separate the signal from the noise,” Kleinhenz said.

But economic data that has come in since February has made it clear that the initial forecast would easily be exceeded. Numbers for the first five months of the year showed retail sales tracking 17.6 percent above the same period in 2020 – a rate of growth likely sufficient to meet or exceed the initial forecast even if sales are flat for the remainder of the year.

Advertisement

In addition, sales have grown year-over-year every month since June 2020, and the $388.6 billion in sales seen during May was the second-highest level on record, topped only by $414.7 billion during the height of the holiday season in December 2020. Gross domestic product already grew at an annual rate of 6.4 percent in the first quarter of this year, and NRF now expects GDP for the full year to grow close to 7 percent. That would be the fastest growth since 7.2 percent in 1984 and far above the 4.4 to 5 percent forecast in February. Personal consumption expenditures, which include both goods and services, are now expected to grow 7.5 percent year-over-year rather than 4.5 percent.

“As the pandemic illustrated so vividly in 2020, we should expect the unexpected,” Kleinhenz said. “But based on the data at hand, things are looking very good for the economy and consumers, and we think it was prudent to update our forecast given the brightening picture.”

Over the years, INSTORE has won 80 international journalism awards for its publication and website. Contact INSTORE's editors at [email protected].

Advertisement

SPONSORED VIDEO

It’s Going to Set Us Up Very Nicely for Retirement

You’ve worked hard all your life. And if you’re like most jewelers contemplating retirement, you’re hoping that your going-out-of-business sale will add to your nest egg — with minimal complications. That’s exactly what Doug and Jacki Friedrich, fourth-generation owners of Friedrich Jewelers Inc., of Vernon, Conn., experienced when they selected Wilkerson to run their sale. “Jewelers who are contemplating a sale should go with Wilkerson because of their experience,” says Doug. And with financial goals “exceeding expectations,” the couple can now focus on enjoying the next chapter of their lives. “It’s going to set us up very nicely for retirement,” says Jacki. “The money’s coming in and we have no complaints. It’s been wonderful.”

Promoted Headlines

Advertisement

Advertisement

Advertisement

Subscribe


BULLETINS

INSTORE helps you become a better jeweler
with the biggest daily news headlines and useful tips.
(Mailed 5x per week.)

Latest Comments

Most Popular