US retails sales are now expected to grow between 3.3% and 3.8%

US retails sales are now expected to grow between 3.3% and 3.8%

Weaker than expected spending in the first quarter, coupled with decelerating inflation, has contributed to an adjustment in the forecast of US retail sales in 2017, which are now expected to grow between 3.2% and 3.8% rather than the 3.7% to 4.2% forecast earlier this year.

The adjustment from the National Retail Federation (NRF), which excludes automobiles, gas stations and restaurants, follows government data revision and remains above the 3.1% predicted for last year. It compares with the 4.1% predicted in 2015, which marked the biggest annual growth in four years.

In February, the NRF said US retail sales were forecast to grow between 3.7% and 4.2% in 2017, as a stable economy is expected to build on the momentum it gained late last year.

US retail sales set to grow up to 4.2% this year

"Meaningful revisions to retail sales numbers by the Census Bureau and similar revisions to personal income and consumption by the Bureau of Economic Analysis have both affected our forecast and have required us to adjust our 2017 sales projection," explains NRF chief economist Jack Kleinhenz. "While weaker-than-expected spending in the first quarter along with decelerating inflation has also contributed to the revision, NRF anticipates stronger sales heading into the fall and holiday seasons."

Kleinhenz adds total retail sales have grown year-over-year every month since November 2009, and retail sales as calculated by NRF have increased year-over-year in all but one month since the beginning of 2010.