RH Cuts Financial Targets, as Furniture Retailers Face Slower Consumer Spending

Furniture sellers are preparing for a sharp downturn in consumer spending this year as mortgage rates rise and people pull back on purchases of goods such as sofas and beds.

RH formerly Restoration Hardware, late Wednesday became the latest retailer to cut its financial targets, citing a weaker-than-expected economic environment. The company said it expects sales to decline between 2% and 5% in the current fiscal year, a change from the flat to 2% growth forecast earlier in the month. Chief Executive Gary Friedman said a decline in luxury home sales and the prospects of the Federal Reserve further raising the federal-funds rate will contribute to cooling sales.