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COLUMBUS, Ohio -- Retail Forward's Future Spending Index improved to 99.1 for June from 96.6 last month, indicating consumers are in a better spending mood as the summer season approaches.
"Despite fears that consumers are finally throwing in the towel, this month's results show that consumers' desire to shop remains intact," said Steve Spiwak, an economist with Retail Forward. "Job growth, home buying and the recent stock market run up are providing a solid foundation for near-term spending prospects."
Father's Day spending should contribute somewhat to the pickup in overall spending plans, driven mostly by stronger spending on Dad among Up Market households, he says, noting that cards, clothes and consumer electronics top the list of Father's Day gifts.
Other ShopperScape results show that the soaring housing market is stoking home improvement project spending, with the do-it-yourself crowd driving much of that spending. The Home Depot and Lowe's are the primary beneficiaries of the home improvement binge, but Retail Forward cautions against counting out Wal-Mart among down market do-it-yourselfers.
Middle Market households, which account for nearly half of overall consumer spending, drove June spending prospects higher. Spending plans among down market households slipped modestly, while plans among up market households held nearly steady.
The June Future Spending Index for Middle Market households (incomes between $22,500 and $75,000) rose to 100.1 from 93.9 in May. This income segment is much more optimistic about the job situation and income growth. Moreover, the recent drop in mortgage rates has bolstered home buying and refinancing activity for this income cohort, providing added confidence to spend.
The Retail Forward ShopperScape survey is conducted online each month with a sample of 4,000 nationally representative U.S. of households. This month's survey was conducted during the last week of May 2005. Results from the survey are available to members of the Retail Forward Intelligence System as well as through individual reports available for purchase. For more information, contact Kathy Clarke ([email protected]) or visit the ShopperScape™ Web site at http://www.retailforward.com/membercontent/shopperscape/ss_home.asp.