The market environment continues to be challenging for the fashion industry. Demand remains sluggish in Europe, due to inflationary pressures and tight monetary policies, while in the US, uncertainty looms after 2025. In China, consumer confidence suffers from the lingering impact of the real estate crisis. Growth prospects remain strong in emerging economies, in particular in India. This report looks at the forecast sales for key fashion categories in 16 key markets around the world.
This report comes in PPT.
Global real GDP growth is expected to reach 2.9% in 2024, slightly down from 3.1% in 2023 and remaining below the pre-pandemic levels. This slowdown is primarily due to the lagging effect of high interest rates and ongoing high costs for businesses and consumers, while downside risks remain dominant amid rising geopolitical tensions. Further easing of inflation and loosening monetary policy are not expected until later in 2024, hence a cautious short-term forecast for sales of fashion items and discretionary spending, in general.
The US economy continues to defy expectations and showed resilience in the first half of 2024, leading to a further upgrade in its real GDP growth forecast to 2.1% in 2024. Nevertheless, ongoing challenges, including elevated interest rates, persistent inflation and high consumer debts will weigh on consumer spending and growth in the US in the longer term. In China, a lingering real estate crisis and subdued private consumption will continue to restrain economic expansion in the world’s second largest economy. In the Eurozone, real GDP growth is expected to remain low at 0.7% in 2024, before it increases to 1.5% in 2025 amid easing inflation and expected rate cuts.
Despite headwinds, economies in emerging markets in Asia Pacific, including India and Indonesia, and Latin America continue to provide new areas for growth for fashion players. Emerging and developing economies will indeed outperform advanced economies, with 2024 real GDP growth being estimated at 4.0% compared to 1.4% in advanced economies, driven by continuing strength in domestic consumption and in attracting investments which is set to benefit demand for discretionary items like personal accessories and apparel and footwear.
Apparel is the aggregation of clothing and footwear. This dataset covers retail sales of apparel through both store-based retailers and non-store retailers. Excludes black market sales (i.e. untaxed, generated within informal retailing)and duty free sales (travel retail). Items must be new when sold to the consumer; second-hand/used items are excluded. Antique and/or vintage clothing and footwear is also excluded.
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