- Retail sales are projected to grow 4.4% in 2026, reaching $5.6T.
- The forecast outpaces the 3.9% gain from 2024–2025 and the long-term average.
- Higher-income households are expected to drive most of the spending.
- Retail growth outlook does not factor in global geopolitical risks.
Strong Forecast for Retail Sales
The National Retail Federation (NRF) expects US retail sales to rise by 4.4% in 2026, totaling $5.6T, reports Globe St. The projection, made with Oxford Economics, signals continued momentum for the retail sector and tops last year’s 3.9% gain. If the forecast is met, it would mark the strongest non-pandemic annual retail growth since 2013.
Drivers Behind the Growth
The retail forecast reflects resilient consumer spending, led by higher-income households. NRF points to strong income growth, healthy balance sheets, and a stable labor market as key drivers. These factors continue to support steady retail momentum. Additionally, NRF expects an early boost in 2026 from tax refunds tied to the Working Families Tax Cut Act. This influx of cash could further strengthen spending activity early in the year.
Get Smarter about what matters in CRE
Stay ahead of trends in commercial real estate with CRE Daily – the free newsletter delivering everything you need to start your day in just 5-minutes
Consumer Confidence Remains Mixed
Despite a downward trend in the Consumer Confidence Index since 2021, actual retail spending has proven stronger than sentiment indicates. NRF suggests that consumer confidence may no longer accurately predict retail sales, as fundamentals like job growth and household wealth offset worries. A similar disconnect has appeared in the apartment sector, where rent trends have cooled even as underlying demand remains intact.
Risks and Considerations
The NRF’s retail sales outlook excludes potential impacts from the war in Iran, rising oil prices, and future supply chain disruptions. However, the organization points to strong economic fundamentals supporting steady retail growth. It also warns that geopolitical shifts and trade policy changes require close monitoring.
