Mastercard's Economics Institute projects a 5.5% increase in U.S. holiday retail sales. This forecast covers November 1 to December 24. It marks potentially the strongest growth in four years. The projection excludes automotive and gas sales. The forecast anticipates an 11% rise in online shopping. It also projects a robust 3.6% growth for in-store purchases.
The report includes a significant caveat. Approximately half of this projected growth stems from higher prices, not an increase in the volume of goods sold. Chief Economist Michelle Meyer highlighted this detail. She suggests nominal spending is strong; however, inflation heavily influences underlying consumer purchasing power.
Mastercard ties its revenue to the total dollar volume of transactions. The company benefits from inflation-driven spending. Nevertheless, the data points to a cautious consumer. The forecast suggests real transaction growth may temper once inflation subsides.