Consumer Spending Outlook Weakens: Deloitte Research

July 12, 2007  by in UnCategorized   

By Home Furnishings Business in on July 2007 The Deloitte Research Leading Index of Consumer Spending rose slightly this month, but continues to forecast a weak spending outlook due to continued falling home prices and rising gasoline prices.

“While spending was strong through the end of 2006 and into the first quarter of 2007, real spending has clearly slowed in recent months and will not continue to boost top line GDP growth for some time going forward,” said Carl Steidtmann, chief economist with Deloitte Services, LP’s Deloitte Research and author of the monthly index.

The index, including four components—tax burden, initial unemployment claims, real wages and real home prices—rose slightly to 2.86 percent, from a downwardly revised gain of 2.75 percent a month ago.

“With shoppers becoming hesitant about spending, it would be wise for retailers to be sure the customer experience is top notch,” said Stacy Janiak, Deloitte’s U.S. retail leader. “This means focusing on service levels and in- stock positions of the right products, so that browsers can be converted into buyers.”