US retail sales grew less than expected during the holiday season and fell well short of last year’s growth pace, according to a Mastercard (MA) report released Tuesday.
Retail sales excluding automotive increased 3.1% year-over-year from Nov. 1 to Dec. 24, the Mastercard SpendingPulse report showed. That’s slower than the 3.7% rise it expected in September and last year’s 7.6% growth pace.
SpendingPulse covers in-store and online retail sales across all forms of payment. The report showed apparel spending rose 2.4% and increased 7.8% at restaurants. Outlays on jewelry, however, fell 2%.
“This holiday season, the consumer showed up, spending in a deliberate manner,” Mastercard Economics Institute Chief Economist Michelle Meyer said. “The economic backdrop remains favorable with healthy job creation and easing inflation pressures, empowering consumers to seek the goods and experiences they value most.”
Online sales rose 6.3% year over year while in-store purchases were up 2.2%, according to the report.
“Spending online is increasing at a faster pace than in-store, therefore taking a growing slice of the retail pie, but shopping in-store still makes up a considerably larger portion of total retail spending,” Mastercard said.
Promotions kicked off early this season, giving people time to hunt for the best deals, said Steve Sadove, senior adviser for Mastercard.