To say that Wednesday’s report on retail sales from the U.S. Department of Commerce was disappointing is something of an understatement. With gasoline prices plunging, most observers and analysts were looking for a few ticks of improvement in December, an improvement that failed to show up. Instead retail sales fell 0.4%, excluding gasoline sales, and down 1.0%, excluding all auto-related spending. Seasonally adjusted, retail sales fell 0.9% month over month, while year over year the sales rose 3.2%.

The National Retail Federation (NRF) reported Wednesday as well that December retail sales, excluding auto, gas station and restaurant sales, dropped 0.9% (and 4.6% unadjusted) compared with December 2013.

At the same time, the NRF reports that retail sales for the November and December holiday season rose 4% year over year to $616.1 billion, excluding auto, gas station and restaurant sales, and that online and e-commerce sales rose to $101.9 billion. NRF had predicted a sales increase of 4.1% for holiday spending. The average year-over-year increase over the past 10 years is 2.9%, so by that measure 2014 was a much better than average year.

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We noted Tuesday that in its December report the National Federation of Independent Business (NFIB) posted its highest small-business optimism index since October 2006. Among the subindex scores, the one measuring sales expectations going forward rose the most, up 6% compared with November. That indicates that small business owners expect business to improve.

One explanation offered for the lower than expected sales is that consumers are building up their savings on fuel expenses rather than spending it. That could be due to the softness in the U.S. economy in the first half of 2014. The second half of the year was much stronger and could be a solid lead-in to better growth in 2015. The NFIB also reported that 15% of small-business owners will be looking to hire more employees in the next few months.

The NRF’s chief economist said:

Preliminary holiday results affirm our initial belief that consumers going into the holiday season had the spending power necessary to give retail the shot in the arm it needed. While December’s figures are disappointing, holiday sales in 2014 are the best we’ve seen since 2011. We remain positive about the future and expect to see consumers continue to benefit from the extra income gained from an improved job market and the dramatic fall in gas prices.

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