The National Retail Federation (NRF) projects U.S. retail sales to increase between 2.7% and 3.7% in 2025, reaching between $5.42 trillion and $5.48 trillion. The forecast was announced during NRF’s fifth annual State of Retail + the Consumer virtual event, which examines trends in consumer spending and the retail industry.

The expected growth follows a 3.6% increase in 2024, when sales reached $5.29 trillion. The 2025 projection is in line with the prepandemic 10-year average annual retail sales growth of 3.6%.

NRF also anticipates online sales to grow between 7% and 9%, totaling between $1.57 trillion and $1.6 trillion. In 2024, online sales increased by 8.1% to $1.47 trillion.

Additionally, NRF forecasts U.S. gross domestic product growth to slow to just under 2% in 2025, down from 2.8% in 2024. Although consumer confidence has declined due to inflation and concerns over tariffs, NRF states that employment levels, wage growth, and household finances continue to support consumer spending.

The organization expects personal consumption expenditures inflation to remain at approximately 2.5% in 2025. It also reports that consumer credit conditions remain stable, with auto loan and credit card delinquency rates aligning with prepandemic trends.

NRF’s retail sales forecasts exclude auto sales, gas stations, and restaurants to focus on core retail trends. The projections are based on economic modeling that incorporates employment data, wages, disposable income, consumer credit, and historical retail sales figures. Data sources include U.S. government reports and the CNBC/NRF Retail Monitor, powered by Affinity Solutions.