U.S. chain stores reported their slowest January since 1970, with same-store sales growing 0.5 percent compared to the previous year, according to the International Council of Shopping Centers. Department stores and luxury chains posted the biggest declines in sales growth, at 5.7 percent and 2.2 percent, respectively.
Wholesale clubs posted the only significant increase in sales growth, at 6.3 percent, ICSC said.
Gift cards left over from December failed to buoy the month’s sales as they have in previous years, ICSC said. For example, Wal-Mart executives reported that gift card redemptions were below expectations and that customers are holding gift cards longer and using them to buy food and other consumables instead of discretionary purchases.
“With uncertainty about the economy, and the possibility of a recession, consumers have pared their spending,” said Michael P. Niemira, ICSC’s chief economist and director of research. “Looking forward to February, we expect much of the same, as U.S economic problems do not seem to be dissipating anytime soon.”