After a turbulent start to 2014, the National Retail Federation (NRF) has announced it expects sales in November and December (excluding autos, gas and restaurant sales) to increase a healthy 4.1% to $616.9 billion, higher than 2013’s actual 3.1% increase during that same time frame.

Holiday sales on average have grown 2.9% in the past 10 years, including 2014’s estimates, and are expected to represent approximately 19.2% of the retail industry’s annual sales of $3.2 trillion. This would mark the first time since 2011 that holiday sales would increase more than 4%.

“Retailers could see a welcome boost in holiday shopping, giving some companies the shot in the arm they need after a volatile first half of the year and an uneventful summer,” said NRF President and CEO Matthew Shay. “While expectations for sales growth are upbeat, it goes without saying there still remains some uneasiness and anxiety among consumers when it comes to their purchase decisions. The lagging economic recovery, though improving, is still top of mind for many Americans.

“Recognizing the need to keep household budgets in line, we expect shoppers will be extremely price sensitive as they have been for quite some time. Retailers will respond by differentiating themselves and touting price, value and exclusivity.”

While consumer confidence has been unstable much of the year, improvements in key economic indicators in the last few months will give way to increased spending power among holiday shoppers, the retail group said, noting that retail sales, jobs and housing data all point to healthy gains.

“Though we have only seen consumer income and spending moderately—and erratically—accelerate this year, we believe there is still room for optimism this holiday season,” said NRF Chief Economist Jack Kleinhenz. “In the grand scheme of things, consumers are in a much better place than they were this time last year, and the extra spending power could very well translate into solid holiday sales growth for retailers. However, shoppers will still be deliberate with their purchases, while hunting for hard-to-pass-up bargains.”

Shop.org also has released its 2014 online holiday sales forecast, expecting sales in November and December to grow between 8% and 11% to as much as $105 billion compared to the last holiday season.

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