Does the Rosy Retail Sales Report Mean the Economy is Back on Track?

While retail sales numbers indicate good momentum for the economy, "consumers with less earning power may continue to face ongoing pressure and retail sales will encounter further challenges as sequestration takes full effect in March," Shay added.

Indeed, for this past month at least, consumers were not derailed by higher taxes, higher gasoline prices and political uncertainty. Instead, they've been energized by job growth, a rise in home prices and gains in the stock market. But NRF's Shay cautioned that last month’s numbers don’t mean that consumers are in the clear from the repeal of the payroll tax holiday, a continued sluggish economic outlook and destabilizing policy environment in Washington.