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Gallup: Americans Predict Spending $885 on Gifts This Holiday Season

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By    |   Tuesday, 30 October 2018 04:53 PM

Americans predict they will spend $885 on gifts this holiday season.

Gallup reports that total is a bit lower than the $906 recorded in October 2017 but is higher than any other October holiday spending projection in Gallup's trend since the 2007-2009 recession.

Although Americans' Christmas spending estimate is down from last year, that doesn't necessarily mean spending will be lower. According to Gallup modeling of how this measure has related to actual retail sales, historically, it portends another strong year. However, this depends on whether consumer spending intentions remain in this range in Gallup's next reading, in November. Spending could be affected by shifts in economic mood if the stock market undergoes significant changes between now and December, as well as any psychological impact of the Nov. 6 midterm elections.

The latest poll was conducted Oct. 1-10. The $885 spending mean reflects the finding that 33% of Americans plan to spend at least $1,000 on Christmas gifts, 22% say they will spend between $500 and $999, 29% will spend between $100 and $499, and 3% will spend less than $100.

Eight percent of U.S. adults report they won't spend anything on Christmas gifts, which includes those who say they don't celebrate the holiday. Another 5% are unsure how much they will spend.

A separate question in the poll also suggests Americans are poised to maintain last year's elevated holiday spending level. When asked how their expected spending this year compares with 2017, 66% say they will spend the same amount, while nearly as many say they will spend more (14%) as say they will spend less (17%).

The Gallup survey comes a day after the government said U.S. consumer spending rose for a seventh straight month in September, but income recorded its smallest gain in more than a year amid moderate wage growth, suggesting the current pace of spending was unlikely to be sustained.

The Commerce Department said consumer spending, which accounts for more than two-thirds of U.S. economic activity, increased 0.4 percent last month as households bought more motor vehicles and spent more on health care.

September’s rise in real consumer spending sets it on a solid growth path heading into the fourth quarter, Reuters explained.

But the momentum is likely to slow. Personal income rose 0.2 percent in September, the smallest increase since June 2017, after gaining 0.4 percent in August. Wages rose 0.2 percent after jumping 0.5 percent in August.

Wage growth remains gradual despite the unemployment rate being near a 49-year low of 3.7 percent. The saving rate fell to $975.7 billion last month, the lowest level since December 2017, from $1.0 trillion in August.

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Americans predict they will spend $885 on gifts this holiday season.
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Tuesday, 30 October 2018 04:53 PM
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