National Retail Federation Forecasts Sales Growth

The National Retail Federation, the largest retail trade group, forecasts a 4.4% increase in annual retail sales for 2026, reaching $5.6 trillion. This positive outlook is attributed to resilient consumer spending, which was a key economic driver in 2025. The forecast, developed with Oxford Economics, excludes auto dealers, gas stations, and restaurants. Mark Mathews, chief economist of the National Retail Federation, noted that while the United States economy was volatile in 2025, consumer spending remained strong. However, the National Retail Federation is closely monitoring the Iran war, which has caused oil prices to surge by nearly 50% and is creating uncertainty for consumer spending. The forecast may be revised if the war significantly impacts retail sales. Additionally, the United States — United States Department of Labor reported higher-than-expected U.S. wholesale prices in February, partly due to increased food costs, with energy prices further elevated by attacks on Iran by the United States and Israel. Despite a downbeat consumer mood, the National Retail Federation believes wage growth, household balance sheets, and a solid employment market will underpin spending, with the unemployment rate expected to remain below 4.5%. Spending growth is primarily driven by higher-income households.