NEW YORK, Nov. 17, 2014 /PRNewswire/ -- The Deloitte Consumer Spending Index (Index) marginally dipped in October after two months of consecutive increases. The Index tracks consumer cash flow as an indicator of future consumer spendingi.
"The decrease in the real median new home price mainly contributed to the decrease in the Index this month," said Daniel Bachman, Deloitte's senior U.S. economist. "But the fundamentals behind consumer spending remain strong."
The Index, which comprises four components – tax burden, initial unemployment claims, real wages and real home prices – decreased to 4.1 this month from 4.4 last month.
"Despite a slight dip in home prices, consumers appear to be poised for some strong spending this season with lower gas prices and employment gains strengthening their confidence, said Alison Paul, vice chairman, Deloitte LLP and retail and distribution sector leader. "In fact, in our most recent consumer holiday survey, shoppers told us they plan to spend 13 percent more than last year. And, in comparison to recent years, many will be shopping without a strict budget, which is good news for retailers hoping to up-sell or cross-sell more impulse prone shoppers. For retailers, the opportunity is there this year to provide in-demand products along with product complements and premium options. And of course, retailers should think about equipping their sales associates with information and ideas so they are sure to encourage customers to take advantage of additional offerings."
Highlights of the Index include:
Tax Burden: The tax rate has been effectively unchanged staying steady from last month at 11.8 percent.
Initial Unemployment Claims: Claims marginally decreased to 295,000 from 303,000 last month down 9.7 percent from the same period last year.
Real Wages: Real hourly wages were slightly down 0.1 percent from last month to $8.84 this month.
Real Median New Home Price: New home prices fell 9.8 percent from the prior month to $109,000. Prices are still 3.7 percent higher than the same period last year.
For a historical analysis of Deloitte's Consumer Spending Index compared to real consumer spending, visit: www.deloitte.com/us/retail/consumer-spending-index/Oct2014.
About Deloitte's Retail and Distribution Practice
Deloitte is a leading presence in the retail and distribution industry, providing audit, consulting, risk management, financial advisory and tax services to more than 75 percent of the Fortune 500 retailers. With more than 2,400 professionals, Deloitte's retail and distribution practice provides insights, services and solutions assisting retailers across all major subsectors including apparel, grocery, food and drug, wholesale and distribution and online. For more information about Deloitte's retail and distribution sector, please visit www.deloitte.com/us/retail-distribution.
As used in this document, "Deloitte" means Deloitte LLP and its subsidiaries. Please see www.deloitte.com/us/about for a detailed description of the legal structure of Deloitte LLP and its subsidiaries. Certain services may not be available to attest clients under the rules and regulations of public accounting.
i The Deloitte Consumer Spending Index is a proprietary methodology that analyzes economic factors to gauge consumer cash flow as an indicator of future spending. Deloitte's analysis includes data from the U.S. Commerce Department, Bureau of Economic Analysis, U.S. Bureau of the Census, U.S. Department of Housing and Urban Development and the U.S. Department of Labor.
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SOURCE Deloitte
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