Washington - Retail sales are expected to rise 2.5 percent in 2010, as revenue rebounds from last year's 2.5 percent decline.
The projection, by the National Retail Federation (NRF), is based on a slowly thawing job and housing market which is expected to boost consumer confidence throughout the year.
The forecast covers all retail industry sales except automobiles, gas stations and restaurants.
"As we continue to see signs of improvement throughout the U.S economy in 2010, overall sentiment will begin to lift, making way for slight increases in consumer spending," said NRF chief economist Rosalind Wells. "While we still expect shoppers to continue to be frugal with their discretionary spending, retailers will soon be able to reap the benefits of leaner, smarter inventories and a year and a half of pent-up consumer demand."
Other positive economic contributions will come from trade, especially strong exports, a turnaround in the inventory cycle, and federal government spending, the trade association said. Consumer spending will lag behind overall economic growth, Wells estimated, but will continue to expand at a modest 2 percent to 2.5 percent rate.