Retail sales increased again in September as employment grew and inflation and interest rates fell, according to new data from the U.S. Census Bureau. Overall retail sales in September were up 0.4% (seasonally adjusted month over month) and up 1.7% unadjusted year over year. That follows increases of 0.1% month over month and 2.2% year over year in August.

“While there have been some signs of tightening in consumer spending, September’s numbers show consumers are willing to spend where they see value,” National Retail Federation Chief Economist Jack Kleinhenz said. “September sales come amid the recent trend of payroll gains and other positive economic signs. Clearly, consumers continue to carry the economy, and conditions for the retail sector remain favorable as we move into the holiday season.”

NRF forecasts 2024 holiday sales will increase between 2.5% and 3.5% over the same time last year.

Data from Circana found that consumers are adjusting purchasing decisions ahead of anticipated holiday deals. According to the firm, overall retail sales across general merchandise and consumer packaged goods (CPG) were up 3% in dollars and 1% in units for the five weeks ending October 5, compared to the same time in 2023. Discretionary general merchandise retail dollar sales declined 1%, while unit demand increased 1%. Both non-edible CPG and retail food and beverage sales revenue grew 4%, and year-over-year unit sales performance increased 1%.

“While sales revenue for discretionary general merchandise during the two weeks ending October 12, 2024, brought a lift from the two weeks preceding, that lift was aided by pre-promotion pullback in purchasing. The same pre-promotion pullback behavior has occurred during both fall and summer retail promotions over the past two years,” said the company.

“Consumers continue to demonstrate their resilience, both in their willingness to spend when the value is there and their ability to adapt in order to maximize that value,” said Marshal Cohen, chief retail industry advisor for Circana. “There is consumer optimism ahead of the holiday shopping season, but more is needed to fuel retail growth.”

“While specific retailers and products may reap rewards from retailer-driven promotional events, there is less impact on overall retail sales, and the consumer emerges as the big winner,” added Cohen. “Retailers and manufacturers need to get consumers to see the importance of purchases or optimize based on their needs at every step from inquiry to intent.”