The National Retail Federation has projected another year of expansion for US retail, estimating that sales in 2026 will climb 4.4% from 2025 to reach $5.6 trillion. The outlook is based on what NRF describes as a newly enhanced forecasting model developed in partnership with Oxford Economics, and was unveiled during the federation’s sixth annual State of Retail & the Consumer virtual event.
NRF said the updated approach is intended to sharpen how the industry reads demand and interprets macro signals, as retailers navigate a year shaped by geopolitical volatility, shifting inflation dynamics and uneven consumer confidence. Still, the federation’s central view is that household spending will remain the main stabiliser for the broader economy, supporting the NRF 2026 retail sales forecast.
“Consumer spending was a steady and reliable engine of growth in 2025, even as broader economic conditions fluctuated,” NRF President and CEO Matthew Shay said. “We expect that consumer resilience to continue into 2026, with household spending once again serving as a pillar of economic support.”
NRF noted that the projected 2026 increase compares with average annual sales growth of 3.6% over the past decade, excluding the pandemic years of 2020 through 2022, when trends were unusually volatile.
NRF Chief Economist and Executive Director of Research Mark Mathews acknowledged that risks have risen in recent weeks, pointing to heightened instability overseas and ongoing trade policy questions. “Renewed tensions in the Middle East and the ripple effects across global markets are adding more uncertainty to the economic landscape,” Mathews said. “While the geopolitical environment and ongoing trade policy challenges warrant close attention, we remain optimistic that the underlying fundamentals of the U.S. economy will support continued stability in the year ahead.”
The federation expects spending patterns to remain uneven across income groups. Mathews said the outlook continues to look “bifurcated,” with higher-income households expected to account for most of the spending gains across multiple retail categories. NRF also expects a modest lift early in the year from larger refunds linked to tax cuts passed under the Working Families Tax Cut Act.
On prices, NRF sees inflation staying elevated through the middle of the year before easing by the third quarter, which it says could provide some relief to households later in 2026. The labour market is expected to cool as well, with subdued non-farm job growth for much of the year, though NRF still forecasts unemployment will remain under 4.5%.
While consumer sentiment is not expected to rebound materially, NRF argued that sentiment has remained unusually disconnected from actual purchasing behaviour. In its view, fundamentals such as income growth, household balance sheets and labour-market stability should help sustain demand and underpin the NRF 2026 retail sales forecast.
NRF emphasised that its projection is stated in nominal terms. Even so, it expects goods inflation to remain in a relatively lower range, meaning a meaningful share of sales growth should reflect real volume gains rather than simply price-driven increases.
NRF publishes monthly retail sales data and provides forecasts for major shopping periods, including the holiday season, positioning the annual outlook as a planning tool for retailers and brands monitoring demand signals through the year.