By Sabrina Escobar

Tomorrow's retail sales report should confirm that the 2025 holiday season beat the odds to become a resounding success.

Economists polled by FactSet are projecting a monthly increase of 0.4%. While that marks a slight deceleration from November's 0.6% rise, it still points toward healthy spending trends throughout the holiday season.

BofA economist Aditya Bhave slightly increased his December retail sales forecasts to account for better-than-expected spending data in November, noting that underlying spending was "solid" throughout the month.

Indeed, November's report helped reassure economists that demand was hearty heading into the holidays despite concerns over shifting trade policy, new tariffs and a slowing labor market. Importantly, the report showed that the longest-ever government shutdown hadn't dented consumers' end-of-year budgets too much.

December spending should have remained equally resilient. Third-party data released in the past weeks suggests it was.

Online spending rose 6.8% year over year to $257.8 billion, for the period covering Nov. 1 to Dec. 31, a new high for e-commerce, according to data from Adobe Analytics. Mastercard SpendingPulse estimates that total retail sales from Nov. 1 through Dec. 21 -- which includes both in-store and online shopping -- increased at a solid 3.9% annual pace.

The biggest risk of a weaker-than-expected report stems from the way the Census Bureau processes data rather than underlying consumer demand. BofA's Bhave believes that unfavorable seasonal adjustments could drag on December's monthly gain.

That said, December's spending data may not carry much heft with investors, given that monthly retail sales are still being reported on a lag after last October's government shutdown delayed economic data releases. Markets are more interested with what lies ahead rather than a somewhat-stale report, yet the Census Bureau hasn't announced when January's retail sales will be released.

For that reason, retail earnings season -- and any commentary executives provide -- may be a more important read on the state of the consumer than tomorrow's retail sales report.

Retailers such as e.l.f. Beauty, Ralph Lauren and Tapestry all reported strong holiday sales in the U.S. Coach, Tapestry's flagship brand, saw sales rise 25% year over year, while e.l.f's total revenue increased 38%. Most of the retail industry's heavyweights are scheduled to release results in the coming weeks.

Write to Sabrina Escobar at sabrina.escobar@barrons.com

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February 09, 2026 16:04 ET (21:04 GMT)

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