Omicron variant prone to gas inflation, as Individuals hold purchasing, economist says

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According to Jack Kleinhenz, chief economist at the National Retail Federation, the spread of the highly contagious variant of Omicron is likely to fuel inflation as Americans keep shopping instead of spending more outside the home.

However, the advisor to the major retailer said in a press release on Wednesday that he was not up to date with the latest wave of Covid Cases that trigger an economic slowdown or company shutdowns.

“Omicron’s impact on consumer demand is little known, but people who stay at home because of the option are more likely to spend their money on retail goods than on services such as dining out or personal entertainment,” he said in the press release. “That would put inflation under further pressure as supply chains around the world are already overloaded.”

He said that “each subsequent variation has slowed the economy, but the rate of slowdown has been less.” And he added that consumers may have more confidence from being fully vaccinated or hearing of milder cases of the variant.

Covid cases in the US hit a pandemic record of more than 1 million new infections on Monday, according to data compiled by Johns Hopkins University. According to a CNBC analysis of Hopkins data, the country now reports a seven-day average of more than 480,000 new infections, almost double the previous week.

The surge in coronavirus cases has prompted retailers and restaurants, including Starbucks, Apple, Nike and gap-Own Athleta to close stores or shorten opening times as they cope with scarce staff or intensify disinfection. Walmart in the interim nearly 60 US stores closed in coronavirus hotspots last month to disinfect them. Macys said on Tuesday that it is so Reduction of shop opening times for the rest of the month.

However, many of these stores have made it easier for customers to shop another way – from home delivery to roadside collection.

The National Retail Federation also doesn’t expect the pandemic to affect Christmas sales. It predicted sales in November and December Increase between 8.5% and 10.5% compared to last year and achieve record sales of $ 843.4 billion to $ 859 billion.

Kleinhenz later raised that forecast, saying in early December that Vacation sales could increase as much as 11.5% compared to the same period last year.

The trade group expects to announce official holiday sales next week after the Census Bureau released December retail sales data.