The upcoming presidential election is prompting retailers to kick off holiday sales earlier than usual. This shift aims to counteract potential November shopping slowdowns.
What Happened: Retailers are concerned that the uncertainty surrounding election results could dampen consumer spending during a critical holiday season. George Mason University associate professor Mehmet Altug explained to Axios that this apprehension is driving stores to offer holiday deals sooner.
Christmas decorations are already appearing in stores like Costco Wholesale Corporation COST, Walmart Inc. WMT owned Sam’s Club and Hobby Lobby. Lowe’s began selling holiday décor online in July, a month earlier than last year and plans to release more in stores by mid-September.
Amazon.com Inc AMZN has announced its “Prime Big Deal Days” sale for October, likely prompting competitors to launch their own early holiday sales, similar to the impact of Prime Day in July.
Halloween merchandise is also hitting shelves early, with Home Depot Inc HD unveiling its collection in March and launching it online in July. The collection became available in stores on Aug. 29, according to an Axios report.
A recent Bankrate survey revealed that 48% of holiday shoppers plan to start buying gifts in August, September, or October. Natalie Kotlyar, a retail analyst at BDO, says that the extended shopping season benefits consumers by providing more time to find deals.
Why It Matters: The early holiday shopping frenzy is not just a reaction to the presidential election but also a response to broader economic conditions. The Federal Reserve's preferred inflation gauge fell short of expectations in July, with personal spending accelerating, indicating that consumers are still willing to spend despite inflationary pressures.
Moreover, Treasury Secretary Janet Yellen has reassured the public about the economy’s resilience, despite concerns over job growth.
As the presidential election draws near, voters are examining the economic platforms of Vice President Kamala Harris and former President Donald Trump. Harris has been closing the gap in recent polls, challenging Trump’s traditionally strong position on economic issues. According to an August Reuters/Ipsos poll, Trump’s lead on the economy has shrunk to 3%, down from 11% the previous month.
In August, Amazon attributed its disappointing revenue forecast to the ongoing Paris Olympics and the recent assassination attempt on former President Trump.
Additionally, the U.S. services sector posted a stronger-than-expected expansion in August, easing fears of an economic slowdown. However, employment growth has softened, adding another layer of complexity to the economic landscape as the holiday season approaches.
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This story was generated using Benzinga Neuro and edited by Kaustubh Bagalkote
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
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