U.S. shoppers worried by shrinking bank and retirement accounts cut spending across the board in September as the country’s financial crisis worsened, MasterCard reported this morning.
Not one spending category posted positive gains over prior year, according to the report by SpendingPulse, the retail data service of MasterCard.
Overall September apparel sales fell by 5.5 percent from a year ago, with women’s apparel down 9.1 percent. Furniture sales sank 13.3 percent, the worst decline since 2003, while electronics and appliance sales tumbled 13.8 percent.
“The turmoil on Wall Street had an immediate impact on consumer confidence,” said Kamalesh Rao, director of economic research for SpendingPulse. “Uncertainty around the financial markets naturally forces people to scale back their own spending.”
But consumers wary of Wall Street woes taking a bite out of their wealth could also be curtailing purchases until holiday promotions heat up, he said.
“People will save in the months leading up to the holiday season. So this may be some of that pullback,” Rao said.
September sales, which took place during the depth of the U.S. financial crisis, are an indicator of how consumers pressured by higher gas and food prices, falling home values and tight credit conditions will spend during the upcoming holiday season, expected to be the slowest in 17 years.