NRF projects core retail sales growth of 4.1%

The National Retail Federation is projecting that retail sales, excluding automobiles, gas stations and restaurants, will increase 4.1% this year, improving on the estimated 3.7% growth in 2013.

NRF also said it expects online sales in 2014 to grow between 9% and 12%.

"Measured improvements in economic growth combined with positive expectations for continued consumer spending will put the retail industry in a relatively good place in 2014," NRF President and CEO Matthew Shay said in a press release. "Though headwinds in the form of the looming debt ceiling debates, increased health care costs and regulatory concerns still pose risks for both consumers and retailers, we are cautiously optimistic and hopeful that the economic tides will change in 2014.

"As the industry tackles important issues in 2014, such as immigration and tax reform, we will continue to push our nation's leaders to support policies that promote growth and create jobs for hardworking Americans," said Shay.

The NRF said U.S. economic growth is expected to be above its long-term historical average, with real GDP expected to rise between 2.6% and 3%, up from the estimated 1.9% rate for 2013 and the fastest pace in the past three years.

The labor market is expected to continue its modest recovery, averaging approximately 185,000 jobs per month, helping decrease unemployment to near 6.5% or lower by the end of 2014, the group said. Inflation is expected to inch higher, with the Consumer Price Index rising as much as 1.7% this year.

The housing sector is expected to continue to improve in 2014, and stronger household and business confidence should spur more consumer spending, the NRF said.

"The economy remains susceptible to buffets as we are already witnessing in the new year, thanks to harsh winter weather, domestic and global financial issues," said NRF Chief Economist Jack Kleinhenz. "While we are careful not to ignore the challenges, we are optimistic and hopeful that future disruptions will be limited, allowing employment and business investment to grow all the while giving retailers and their customers the confidence in the economy they need."