WASHINGTON, D.C.: The National Retail Federation, the largest retail trade group in the U.S., predicts retail sales to increase from 2.5 percent to 3.5 percent in 2024, slower than the 3.6 percent in 2023.

This week, the federation said it expects retail sales to reach between US$5.23 trillion and $5.28 trillion this year, in line with the 10-year pre-pandemic average annual sales growth of 3.6 percent.

Jack Kleinhenz, chief economist of the federation, said, “The economy is primarily supported by consumers who have shown much greater resilience than expected, and it is hard to be bearish on the consumer.”

The federation’s 2024 retail sales forecast is based on economic modeling that considers various indicators, such as employment, wages, consumer confidence, disposable income, consumer credit, previous retail sales and weather.

Despite a strong jobs market and rising wages driving household spending, retail sales have struggled amid rising prices and credit costs.

The latest Commerce Department report shows that after pulling back in January, Americans increased their spending slightly in February.

But last month’s gain of 0.6 percent was weaker than expected, and January’s decline was revised even lower, suggesting that many are growing more cautious with their money.

Heading into the spring selling season, many retailers are introducing deals while offering free and fee-based loyalty programs, to attract more repeat shoppers.