NRF Forecasts 4.4% Retail Sales Growth in 2026 despite Uncertainty

The National Retail Federation projects 4.4% sales growth this year, up from 3.6% in 2025. The forecast acknowledges a softening labor market and inflation pressures but points to higher tax refunds and resilient consumer spending.

The National Retail Federation on Monday projected retail sales will grow 4.4 percent this year, an acceleration from 2025's 3.6 percent increase, even as the industry confronts softening labor markets, persistent inflation, and geopolitical uncertainty that has rattled consumer confidence.

The forecast, released at the NRF's annual Washington conference, predicts total retail sales will reach $5.8 trillion in 2026, excluding automobile dealers, gasoline stations and restaurants. Online and non-store sales are expected to grow 9 to 12 percent, continuing their steady capture of market share from traditional brick-and-mortar retailers.

"Consumers remain resilient, but they are navigating a complicated environment," NRF Chief Economist Jack Kleinhenz said in a statement. "The underlying fundamentals are still solid, but we are seeing a softening in the labor market and uncertainty about the direction of the economy."

The forecast acknowledges headwinds that have intensified in recent months. The ongoing conflict with Iran has pushed oil prices higher, threatening to increase costs for transportation and manufacturing. Tariff uncertainty continues to cloud supply chains, with the administration's shifting trade policies leaving retailers uncertain about costs for imported goods. Consumer sentiment surveys have shown declining confidence, particularly among lower-income households.

But the NRF pointed to several countervailing factors. Higher tax refunds this year are expected to put more cash in consumers' pockets. Household balance sheets remain relatively healthy, with savings rates above pre-pandemic levels. Wage growth, while slowing, continues to outpace inflation for most workers.

As the National Retail Federation projects steady growth amid softening labor markets and geopolitical uncertainty, The Silicon Review examines how retailers are navigating a year of competing pressures and whether higher tax refunds and resilient consumers will be enough to offset the headwinds.