The National Retail Federation is projecting U.S. retail sales will rise 4.4% year over year in 2026 to $5.6 trillion, signalling continued consumer resilience even as economic uncertainty builds.
The forecast, which excludes automotive dealers, gas stations and restaurants and is not adjusted for inflation, comes in above the NRF’s long-term average of 3.6% annual growth and ahead of its more cautious outlook last year.
In 2025, retail sales reached $5.4 trillion, with holiday spending surpassing $1 trillion, according to the group.
The NRF’s outlook is underpinned by what it describes as strong “underlying fundamentals” in the U.S. economy, alongside expectations for higher tax refunds to support spending.
CEO Matthew Shay said the sector continues to benefit from resilient consumers, even as sentiment indicators remain weak.
The group noted that consumer confidence has historically been a poor predictor of actual spending behaviour.
The forecast also incorporates a new modelling approach developed in partnership with Oxford Economics, which has suggested the U.S. economy could outperform consensus expectations this year.
Despite the relatively upbeat projection, the NRF acknowledged several headwinds, including a softening labour market, persistent inflation and ongoing trade policy uncertainty.
Related Story
Unemployment is expected to remain below 4.5%, while goods inflation is likely to stay lower than services inflation, helping to support real consumption.
Geopolitical risks, particularly the Iran conflict, were not factored into the forecast due to their unpredictability, according to chief economist Mark Mathews, who said the group would revise its outlook if conditions materially change.
Other analysts are less optimistic. Economists at Wells Fargo have flagged signs of weakening consumer demand, while New England Consulting Group estimates retail growth could struggle to reach 3% amid rising household costs and debt levels.
Meanwhile, Moody’s has projected that real consumer spending growth could slow to around 1.5% in 2026, though it is still expected to remain a key driver of the U.S. economy.
The divergence in forecasts highlights the uncertain outlook for retail, with consumer strength continuing to underpin growth even as macroeconomic and geopolitical pressures intensify.
Click here to sign up to Retail Gazette‘s free daily email newsletter
