Industry tracker comScore reported that US shoppers spent a total of $42.3 billion online during the year-end holiday season — a 14 percent jump from the same period in 2011. “The 2012 online holiday season was once again a very strong season with growth rates in the mid-teens as we reached record-setting spending levels,” said comScore chairman Gian Fulgoni.
US e-commerce started out “at a very healthy” rate in November but consumers quickly eased back on spending, apparently due to concerns that Congress would fail to make a budget deal averting a “fiscal cliff.” “You might say that had it not been for Congress, every other indicator suggested it would have been an even merrier Christmas for online retailers,” Fulgoni said.
A “December swoon” in online shopping coincided with a drop in consumer confidence attributed in large part to worries that unresolved budget matters would trigger automatic tax increases and spending cuts at year’s end.
President Barack Obama signed a “fiscal cliff” deal into law, averting a financial crisis with global repercussions. However, the International Monetary Fund, rating agencies and analysts warned that the critical problem of deficits and debt still hang over the US economy. Financial markets turned cool towards the last-minute agreement, in contrast to the initial stocks surge which had earlier greeted the deal. The agreement averted across-the-board tax hikes and automatic spending cuts which some had feared could have tipped the US economy back into recession.
While Democrats and Republicans passed a compromise, they only delayed the imposition of spending cuts for two months, meaning another debilitating stand-off is almost certain at the end of February.