Sales in the retail sector, which excludes automobiles, gas stations, and restaurants, are expected to approve in the year ahead.

The National Retail Federation predicts a sales gain of between 3.7% and 4.2% over 2016. Online and other non-store/online sales are expected to be up between 8% and 12%.

Consumers in the driver's seat

“The economy is on firm ground as we head into 2017 and is expected to build on the momentum we saw late last year,” said NRF President and CEO Matthew Shay. “With jobs and income growing and debt relatively low, the fundamentals are in place and the consumer is in the driver’s seat.

But, he notes, this year is unlike any other. While consumers have strength they haven’t had in the past, they will remain hesitant to spend until they have more certainty about policy changes on taxes, trade, and other issues being debated in Congress.

“Lawmakers should take note,” Shay warned, “and stand firm against any policies, rules or regulations that would increase the cost of everyday goods for American consumers.”

NRF Chief Economist Jack Kleinhenz agrees that prospects for consumer spending are good, pointing out that more jobs and more income will result in more spending.

But he cautions that regardless of sentiment, “the pace of wage growth and job creation dictate spending. Our forecast represents a baseline for the year, but potential fiscal policy changes could impact consumers and the economy.”

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Jobless claims

From the Department of Labor (DOL), we have word that first-time applications for state jobless benefits were down by 12,000 in the week ending February 4 to a seasonally adjusted 234,000.

The four-week moving average came in at was 244,250 -- a drop of 3,750 from the previous week, and the lowest level since November 3, 1973, when it was 244,000.

The complete report is available on the DOL website.

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