The National Retail Federation (NRF) expects US retail sales in 2026 to increase 4.4% from 2025, reaching $5.6tn.
The outlook is based on an updated forecasting method that the NRF said it developed with Oxford Economics.
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The figures were released during the organisation’s sixth annual State of Retail & the Consumer virtual event.
NRF president and CEO Matthew Shay said: “Consumer spending was a steady and reliable engine of growth in 2025, even as broader economic conditions fluctuated.
“We expect that consumer resilience to continue into 2026, with household spending once again serving as a pillar of economic support.”
NRF said its 2026 projection sits above the 3.6% average annual growth recorded over the past decade, excluding the pandemic years from 2020 to 2022, when sales trends were unusually volatile.
NRF chief economist Mark Mathews said: “Renewed tensions in the Middle East and the ripple effects across global markets are adding more uncertainty to the economic landscape.
“While the geopolitical environment and ongoing trade policy challenges warrant close attention, we remain optimistic that the underlying fundamentals of the US economy will support continued stability in the year ahead.”
Mathews said spending expectations remain split between higher- and lower-income households, with wealthier consumers accounting for most of the increase across multiple retail segments.
NRF also expects a limited lift in consumer activity in the first half of the year, linked to larger refunds tied to tax cuts passed under the Working Families Tax Cut Act.
Inflation is forecast to stay high through midyear before moderating in the third quarter.
On employment, the federation anticipates weaker labour market conditions, pointing to subdued non-farm job growth for much of the year.
However, it expects the unemployment rate to remain under 4.5%.
While consumer sentiment is not predicted to improve substantially, NRF said it has continued to diverge from spending behaviour.
The organisation added that income gains, household balance sheets and labour market stability are expected to underpin consumer activity through 2026.
