U.S. specialty jewelry store sales rose only 1.2 percent year on year to $2.244 billion in September. The sales total was the weakest by value since January when revenue estimates barely topped $2 billion. As reported earlier on Rapaport News, preliminary U.S. jewelry and watch sales from all retail channels in September rose and estimated 3 percent year on year to $5.521 billion, but that data is subject to several revisions.
Specialty jewelry store sales have risen by a healthy 4.2 percent year on year to $22.374 billion for the first 10 months of 2014, while jewelry and watch sales from all channels have risen 2.8 percent to $51.129 billion, according to Rapaport News estimates.
Meanwhile, advanced sales estimates at U.S. department stores in October fell 1.9 percent year on year to $13.13 billion, according to government figures. Department stores have continued to struggle as sales have fallen 2.6 percent for the first 11 months of 2014 to $127.1 billion. Advanced estimates for all U.S. retail and food services sales in October, however, jumped 4.1 percent to $444.5 billion. Retail trade sales increased 3.8 percent and nonstore retailers recorded a sales increase of 9.1 percent.
U.S. chain-store sales in October were stronger than the jewelry sector, posting a 4.6 percent increase for same-store sales, according to the International Council of Shopping Centers (ICSC).
“An improving economy continues to be the main driver of stronger consumer demand compared with last year,” said Jesse Tron, the spokesman for ICSC. “While in the short term the lower gas prices may have reduced the overall rise in sales this month -- the added boost in discretionary income for consumers will help propel discretionary retail categories during the upcoming holiday season.”
ICSC anticipates that chain-store sales in November will experience comparable-store sales growth of between 4 percent and 5 percent.
Retail analysts at Sterne Agee concluded that October's overall sales improvement was welcome, but nowhere near an increase that is more typical for the U.S. when gasoline prices drop significantly. October's retail sales were only up 0.3 percent compared with September's figures, which fell 0.3 percent compared with August. Lindsey M. Piegza, the chief economist at Sterne Agee, explained that with three consecutive months of aggressive energy price reprieve, anything less than a 1 percent month-to-month bounce for retail sales highlights how fragile the U.S. economy remains.
"While the weakness in October was dominated by a few categories, there was insufficient demand elsewhere to compensate. Consumers continue to spend, but at a modest level with no sign of further momentum in sight with income growth stubbornly limited," Piegza wrote in a note to clients.
"We are a consumer based economy and if the consumer is struggling to go out and spend on goods and services, or Americans are simply hesitant to ramp up spending, headline activity is likely to significantly underperform the Fed's optimistic forecast of 2 percent growth in 2014 and circa 3 percent in 2015. It will take organic job and income growth to propel consumers to ramp up spending beyond a 2 percent pace, but as business remains uncertain regarding the shape of the U.S. recovery, producers continue to rely on temporary, flexible and low-cost labor," Piegza concluded.
