Retail Sales Flat in December, Closing Out Lackluster Year

Shoppers pause spending despite economic headwinds, raising concerns about consumer confidence

Published on Feb. 10, 2026

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Retail sales were unchanged in December from November, surprising economists who expected a modest increase. The flat sales figures closed out a lackluster year for the retail sector, with many businesses posting declines across categories like furniture, home goods, and electronics. The data suggests consumer spending has finally caught up with declining consumer confidence, raising questions about shoppers' ability to maintain resilience in the face of economic uncertainty.

Why it matters

The retail sales report offers a key indicator of the health of the U.S. economy, as consumer spending accounts for around 70% of economic activity. The unexpected pause in spending raises concerns that economic growth may be slowing, despite robust GDP figures, as consumers grow increasingly cautious amid factors like slowing job growth and trade tensions.

The details

Retail sales were flat in December, compared to a 0.6% increase in November, according to the Commerce Department. Economists had expected a 0.4% increase for December. Sales declined in categories like furniture, home furnishings, and electronics, while building materials, gas stations, and food/beverage stores saw small gains. The lone services category, restaurants, also registered a 0.1% dip.

  • Retail sales fell 0.1% in October, rose 0.1% in September, and jumped 0.6% in July and August.
  • The December retail sales report was delayed due to the 43-day government shutdown.

The players

Chris Zaccarelli

Chief investment officer for Northlight Asset Management in Charlotte, North Carolina.

Thomas Ryan

North America economist at Capital Economics.

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What they’re saying

“Consumer spending has finally caught up with consumer sentiment, and not in a good way.”

— Chris Zaccarelli, Chief investment officer (Northlight Asset Management)

“This month's data show that consumers are no longer relentlessly increasing their level of spending.”

— Chris Zaccarelli, Chief investment officer (Northlight Asset Management)

“Consumption at the end of the first quarter of this year 'may turn out to be a lot stronger than it currently looks at the start.'”

— Thomas Ryan, North America economist (Capital Economics)

What’s next

Economists will be closely monitoring upcoming reports on jobs and consumer prices to gauge the health of the economy.

The takeaway

The flat retail sales figures in December suggest consumer spending is finally aligning with declining consumer confidence, raising concerns about the strength of the economy despite robust GDP growth. Retailers will be closely watching for signs of a rebound in the new year, as the economy navigates a confusing mix of positive and negative indicators.