Oct 7, 2018

Holiday retail sales will be strong — just not the strongest

Photo: Hiroko Masuike via Getty Images

Consumers will deliver a robust holiday shopping season, thanks to a booming economy. But industry watchers forecast sales growth won't measure up to last year.

Why it matters: Consumer spending makes up a huge chunk of gross domestic product, and what they spend during November and December contributes to that. The holiday season can account for as much as 30% of retailers' annual sales, according to the National Retail Federation.

Last year, holiday sales topped $690 billion, a 5.3% increase from the previous year. That was the biggest year-over-year gain since 2010.

This year's estimates:

  • The National Retail Federation expects holiday sales growth to slow a bit, with an increase of 4.8% from the previous year. CEO Matthew Shay pointed to higher gas prices and tariffs as potential headwinds.
  • AlixPartners, a retail consulting firm, predicts retail sales will rise 4.1%, citing the potential for economic hiccups after the midterm elections.
  • Two other forecasts, from Deloitte and PwC, expect sales growth to hit 5%.

Correction: This item has been updated to fix the spelling of Matthew Shay's name.

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Scoop: Top NSC official reassigned to Energy Department amid "Anonymous" fallout

Photo: Mark Wilson/Getty Images

Deputy national security adviser Victoria Coates will be reassigned as a senior adviser to Energy Secretary Dan Brouillette, the National Security Council said Thursday — and a senior White House official said that the administration "rejects" the rumors that she is "Anonymous."

Why it matters: Coates has battled claims that she is the still-unknown Trump administration official that penned a New York Times op-ed and book critical of President Trump.

The Fed may be setting the table for 2020 rate cuts

Illustration: Sarah Grillo/Axios

The Fed looks to be laying the groundwork to lower U.S. interest rates this year, just as they did in April 2019 before cutting rates in July, September and October.

Why it matters: A Fed rate cut makes taking on debt more attractive for U.S. consumers and businesses, helping to juice the economy, but also puts the central bank in a weaker position to fight off a potential recession.

Morgan Stanley to buy E*Trade in a $13 billion deal

Photo: Rafael Henrique/SOPA Images/LightRocket via Getty Images

Morgan Stanley is planning to buy E*Trade Financial Corp. in a $13 billion all-stock deal, the Wall Street Journal reports, with plans to acquire the company known for helping everyday Americans manage their money.

Why it matters: The deal, which would be the largest by a major American bank since the financial crisis, signals Morgan Stanley‘s desire to bulk up in wealth management.