What: The FT predicts that once the inflation distortion is stripped out, the season will show a decline in sales and revenue year on year.

Why it is important: While the crunch in Europe and the rest of the world is expected for Q1 2023, these predictions for the US might have some consequences on customers’ morale a few weeks before the much-expected Christmas season.

The Financial Times reports that retailers are facing their first real-terms fall in revenue since the global financial crisis, as Black Friday starts in a unusually high inflation period (the highest since the early 80s). While the newspaper expects a growth of +4.5% y-o-y, this means -1.2% when the inflation effects are stripped out.

In addition to retailers selling at a higher price to offset their own costs, customers will be looking to promotional offers and make the most of their credit card borrowings, all of which will be eroding retailers margins this season.

US retailers face first sales slowdown since financial crisis