Sales gains in 2005 at American retailers will slow to about half of last year’s rate as consumers curb spending at chains such as Target Corporation and Federated Department Stores Incorporated amid higher interest rates and debt, according to the National Retail Federation.

Total sales of clothing, books, sporting goods, home furnishing, and other items will rise 3.5% this year, compared with a 6.7% gain in 2004, the Washington-based trade association said yesterday.

Higher interest rates and slowing home refinancing will limit consumers’ budgets, a federation economist, Rosalind Wells, wrote in a report. Increased hiring and wage growth may not be enough to make up for tax cuts that helped boost spending last year, she wrote. Household budgets may also be restrained by higher energy and food prices.

“The economy is still moving upward, though not at a fast pace,” said Donald Gher, who helps manage about $600 million at Coldstream Capital Management in Bellevue, Washington, including Wal-Mart Stores and Costco Wholesale Corporation shares. “The consumer is still a question mark as we go forward. It’s going to be a long year.”

A slowdown in consumer spending, which accounts for more than two thirds of the American economy, could restrain economic growth, according to the National Retail Federation. Real gross domestic product is expected to rise 3.4% this year, compared with 4.5% in 2004.

Profit gains at retailers including department and discount stores also will slow, rising about 16.8% this year, compared with an estimated gain of 17.7% in 2004, according to Thomson Financial.

Slower sales growth probably will limit gains in retailers’ share prices, J.P. Morgan analyst Shari Schwartman Eberts wrote in a report.

Consumer spending last year was boosted by demand for luxury items and a better-than-expected 5.7% rise in holiday sales, according to the retailers group. Sales comparisons will be difficult for retailers in the first half of the year, Smith Barney analyst Deborah Weinswig wrote in a report.

Shoppers will be more dependent this year on job growth in the absence of new tax cuts, said Steve Spiwak, senior economist at consulting firm Retail Forward in Columbus, Ohio. Job gains of 150,000 a month should continue over the next several months, he said.

“Consumer spending will hinge on job growth,” Mr. Spiwak said. “We don’t have the one-time impact of tax cuts and refinancings over that past couple of years that stoked spending.”

Sales gains among high-end retailers, which benefited as wealthier shoppers splurged last year, may slow as they face more difficult comparisons, Ms. Eberts wrote.

The Federal Reserve raised interest rates by 1.25 percentage points last year and is expected to continue increasing, according to the National Retail Federation. That may cause some shoppers, who already face high credit-card bills, to pull back on spending, said David Abella, who helps manage about $1.2 billion at Rochdale Investment Management in New York.

“That could not only choke up the consumer but start to have a negative effect on the economy as a whole,” Mr. Abella said.

Retailers such as Wal-Mart that cater to lower-income shoppers may benefit as companies start hiring more, said David Joy, vice president of capital markets at American Express Financial Advisors in Minneapolis. Declining gasoline prices should also take some pressure off these consumers, he said.

“Some bargaining power may shift to labor force, which has been virtually excluded from any position of strength over the past few years,” said Joy, who manages about $324 billion, including Wal-Mart shares. “Wages may be stronger than they’ve been.”

Wal-Mart had its slowest holiday season sales gains last year in more than a decade, with sales rising 0.7% in November and 3% in December.