The National Retail Federation predicted U.S. holiday would grow 4.2 percent during November and December this year, hitting $1.01 trillion.
Nearly half that growth will be from real consumer spending growth, with inflation accounting for the rest of the increase, NRF indicated.
In 2025, holiday sales increased 3.1 percent to $972 billion, according to the NRF.
“We continue to be very impressed with the resilience that consumers have demonstrated, as they continue to spend and power our economy,” said Matthew Shay, NRF president and chief executive officer, during a conference call on the holiday outlook on Thursday. “Households continue to navigate persistent inflation and uneven confidence about the economy, but throughout the year consumers have repeatedly shown that holiday spending on loved ones are priorities, and that’s actually been true for many years.”
NRF’s forecast was made in conjunction with Oxford Economics, and takes into consideration real disposable income, the labor market, the rate of unemployment, wages, household wealth, inflation and the patterns of sales this year so far. The forecast excludes auto dealers, gas stations and restaurants.
Regarding seasonal help, it’s a “low hire, low fire” labor market, where retailers are expected to onboard 325,000 to 375,000 workers, roughly in line with last year’s 356,000 seasonal hires, Shay said.
Mark Mathews, NRF’s chief financial officer, added: “This year, retail spending has been consistently strong. Last week, we released our September retail monitor, which showed 12 consecutive months of retail sales growth, and we expect some of that momentum to push into November and December. Having said that, while the overall outlook is positive, we do expect the experience of individual households will vary significantly based on income levels and wealth, and exposure to higher everyday costs, like gasoline and other household essentials. There are five key factors to think about in relation to this forecast: inflation, income, the labor market, household wealth and consumer confidence. There’s no doubt inflation is contributing to our nominal sales growth forecast.”
Mathews said he expects core goods inflation, measured by the Personal Consumption Expenditures (PCE) price index, to hit 2.5 percent in 2026, compared to 1.6 percent in 2025. Core goods excludes food and energy. For 2026 so far, the average rate of PCE inflation is at 2.95 percent. Inflation overall in the U.S. stood at 3.7 percent in September.
“As we head into the holiday period, if gas prices remain higher, this will have a larger impact on households at the lower end of the income spectrum.”
He also said “the divide in consumer spending is becoming more pronounced. Higher gas prices, increasing food prices, all these things weigh more heavily on moderate-income households. At the same time, rising financial wealth continues to support spending by higher-income households. Wealth effects are the strongest in areas outside of core retail, such as in automobile, travel and hospitality, but we do expect retail categories to also benefit from that effect.”
He also said consumer confidence, which has hit all-time lows this season, is “a pretty poor predictor of actual spending. Real disposable income, the labor market, health and household wealth are much more important drivers of our forecast.”
In other forecasts, Bain & Co. sees holiday sales rising 4.5 percent, surpassing $1 trillion with a 9 percent leap in nonstore sales and 2.5 percent in-store growth; Mastercard predicts holiday sales (excluding auto and gas) will rise 5.5 percent, with sales at store growing 3.6 percent, while online sales spike 11 percent.
Deloitte forecasts U.S. holiday e-commerce of $316.1 billion to $318.9 billion for November 2026 through January 2027, up 7.5 percent to 8.4 percent. Total retail is projected to grow 4 percent to 4.8 percent to about $1.7 trillion. Adobe forecasts U.S. online sales will increase 6.7 percent to $275.1 billion.
Holiday shopping started earlier than last year, triggered by Amazon Prime Days held Oct. 6-7, a day earlier than last year.
Among the trends expected, discounting will be at or near historic high levels, with retailers aware that consumers are pinched by rising prices.
Apparel is high on consumers’ gift lists, lifted by the need for better-fitting looks amid the widening use of GLP-1 drugs, back-to-office trends spurring sales of items such as cashmere sweaters and wool coats, and mall traffic, which is seen continuing its Gen Z-led trajectory upward.
Also seen is increasing use of AI by consumers for product discovery and price comparisons, while retailers use the technology to gain efficiencies and cut costs.