Department store group Myer is expected to continue a solid recovery on the ASX in 2023 even though the retail sector is set to cool as cost-of-living increases crimp spending by households, after it posted its strongest sales in almost two decades.

Shoppers spent up big on categories such as fashion, footwear and accessories to attend events and functions as Australians began going out again with gusto, pushing Myer shares up 5.3 per cent to their highest level since mid-2017.