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TeleCheck: retail sales growth slows

With consumers apparently holding on to their wallets until the closing, promotional days of the holiday shopping season, retail sales grew a modest 1.8 percent during the first 24 days of the season, down from a greater gain of 2.4 percent during the same period a year ago, according to TeleCheck Services Inc.

But with last-minute splurge shopping still to come, William Ford, TeleCheck senior economic advisor, forecast "at least a 2.0 percent increase in same-store sales for the entire 32-day holiday season."

Helping to prop up spending, said Ford, are falling energy, gas and home heating oil prices, coupled with the government's $750 billion stimulus package.

"Although consumers slowed their pace of spending, it is not unusual for this time of year — especially with a long, last weekend ahead," said Ira Silver, TeleCheck's senior retail adviser. "Twenty-four days into last year's holiday shopping season, retail sales were only 2.4 percent over 1999 — and that was with a 5.6 percent gain to kick off the season. Still, final figures for that year came in at 3.1 percent over the year before as a result of the last-minute shopping rush." As in years past, said Silver, "we expect to see a significant surge in spending as we approach the end of the holiday season, with Saturday, Dec. 22, as the biggest shopping day of the year."

During those first 24 days of the shopping season, sales were strongest in the Southeast, jumping up by 2.6 percent, fueled by a big 2.7 percent increase in Louisiana and a 2.6 percent gain in Florida.

Southwestern sales rose by 2.3 percent, with sales climbing by 2.6 percent in Oklahoma, by 2.4 percent in Missouri and by 2.3 percent in Texas.

Sales in the Northeast region grew by 1.8 percent, with New York jumping up by 2.5 percent and Massachusetts climbing by 1.5 percent.

Sales in the Midwest rose by 1.8 percent, bulked up by gains of 2.5 percent in Wisconsin and 2.0 percent in Minnesota.

In the Mid-Atlantic states, sales rose by 1.5 percent, lifted by gains of 2.4 percent in New Jersey and 1.5 percent in both Pennsylvania and Virginia.

Sales were at their most sluggish in the West, growing by just 1.3 percent. Sales climbed by 2.1 percent in Hawaii, by 1.5 percent in Washington and 1.4 percent in Oregon.

The TeleCheck Retail Index measures year-over-year, same-store sales based on check-writing volume at more than 27,000 retail units nationwide.

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