Nov. 03--RICHMOND, Va -- Holiday sales should be solid -- but not stellar -- as consumers, buoyed by an increased confidence in the economy, hit stores in the next couple of months.
That's the sentiment from a panel of experts who gave their outlook for the economy at the Retail Merchants Association's annual Economic Forecast Breakfast on Friday.
The experts -- Alan Gayle, senior investment strategist and director of asset allocation for RidgeWorth Investments; Ann Battle Macheras, a vice president of research for the Federal Reserve Bank of Richmond; and Laura Lafayette, CEO of the Richmond Association of Realtors -- said the improving job market, a rebound in housing and consumer confidence will motivate shoppers.
"For those of you who have been in retailing a long time, you know that the last few years have been one of the more challenging times we've seen," Gayle told the 190 people attending the meeting at the Westin Richmond hotel.
"The general message I want to give you ... is that we have some good news and we have some not-so-good news."
The panel cautioned that, despite recent positive economic developments, crosscurrents could dampen enthusiasm for holiday sales. Among the concerns are the slow pace of job growth, the European recession and the looming federal "fiscal cliff."
"The economy is moving forward. Again it is (growing) at a pace slower than we're expecting, but I would argue that consumers are feeling a little better about themselves than they were last year," Gayle said.
Overall, the panel was positive about the direction of the economy and the potential for the holiday shopping season.
Macheras said the area's job market was relatively strong when compared to the rest of the nation.
The national unemployment rate ticked up slightly to 7.9 percent in October, it was announced Friday. The Richmond region's seasonally adjusted jobless rate stood at 6.3 percent in September.
"We've got a healthy rate of growth" here, Macheras said.
But she said the economy is expanding only at a modest pace and warned that unemployment, while down from last year, remains high.
Nevertheless, the economy is headed in the right direction, which should bode well for merchants looking to capture holiday sales, she said.
One particularly bright spot in the economy is the housing market, the experts agreed.
"After the last few years, it's good to have some good news," Lafayette said. The number of houses being sold across the region is inching back up after a disastrous 2008, 2009 and 2010, she said.
Henrico County is seeing solid growth in sales, while Richmond is leveling out after a strong 2011.
Inventory is down and the housing market is returning to its historical patterns, Lafayette said. But she worries that tight credit standards and regulations in the housing industry could hurt in coming years.
The panel's assessment of a solid, though not superb, holiday shopping season mirrors forecasts from national organizations.
Consulting firm Deloitte forecast that 2012 holiday sales would rise between 3.5 and 4 percent this year, down from a gain of 5.9 percent in 2011.
The National Retail Federation forecast that holiday sales would increase 4.1 percent to $586.1 billion, lower than last year but higher than the 10-year average.
And the International Council of Shopping Centers forecast holiday chain store sales to increase by 3 percent.
The panel was moderated by Gregory J. Gilligan, business editor at the Richmond Times-Dispatch.
(c)2012 the Richmond Times-Dispatch (Richmond, Va.)
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