It has been suggested that the increased spending by many Americans over the Christmas period may not be taking as much of a toll on them this January as it may have in previous years. Every year, many people who cannot really afford it end up spending a fortune on things such as entertaining, going out, new clothes, parties, and of course presents for loved ones. This results in a huge number of consumers finding themselves in financial dire straits during the early part of the year, as they struggle to get back on track with their finances having overspent at Christmas.
However, recent figures based on the Problem-Driven Consumer Index suggest that while some people are still having to reduce spending in January, the effects of Christmas overspending may not be as bad this year as they were in January 2015. The index is put together by the Georgetown Institute for Consumer Research, and officials from the institute said that the figures suggested that retail spending may be increasing compared to last year. This was based on the fact that the index was close to forty percent higher this January compared to last.
Contrasting reports from Commerce Department
Despite the encouraging figures and report from the consumer index with regards to what spending levels may be like this year, a very different picture has been painted in separate date that has been released by the Commerce Department. These were figures relating to December 2015 consumer spending, which showed that purchases at American retailers fell by 0.1 percent and this reflected the weakest year since 2009. This suggests that the consumer spending outlook for this year may not be as impressive as the index suggests.
The Commerce Department figures have resulted in worries with regards to whether consumer spending is likely to take a tumble this year, as households struggle financially due to factors such as lack of salary gains. The figures went on to show that over the course of last year sales increased by just over two percent, which reflected the smallest increase of the current expansion of the economy. A number of different retail sectors were affected including electrical retailers, clothes shops, and even grocery retailers. Officials said that this was an indication that Americans wanted to ensure that they were putting any spare money aside for greater financial security rather than spending it on items that they did not really need.