U.S. retail sales rise 0.5% in July, signaling gradual recovery
U.S. retail sales rose 0.5% in July compared to the previous month, Yahoo! Finance reported, marking the second consecutive monthly gain following a slowdown in consumer spending earlier this spring. The increase, while slightly below economists’ expectations of a 0.6% rise, suggests that consumer activity is stabilizing after declines in April and May.
Revised data for June also showed stronger momentum, with retail sales increasing 0.9%, up from the initially reported 0.6%. However, July’s figures revealed uneven performance across sectors, indicating that while consumers are spending, they remain selective and cautious.
Notable gains were seen in home furnishings, which posted a 1.4% increase in sales, and non-store retailers, including e-commerce platforms, which saw a 0.8% uptick. In contrast, spending at food and drinking establishments fell 0.4%, a surprising drop during a traditionally strong summer month. Building and garden supply stores also experienced a 1% monthly decline and a 2.6% year-over-year drop, according to Yahoo! Finance.
Excluding autos and gas, core retail sales increased just 0.2% in July, reflecting modest underlying strength. The data suggests that while consumers are not pulling back dramatically, their spending pace remains well below the 2.8% growth rate recorded in 2024.
The report comes amid a mixed economic backdrop. While inflation remains relatively contained for consumers, producer price data indicates potential cost pressures ahead, according to Yahoo! Finance. Combined with a softening labor market and the potential impact of tariffs, household spending may face further challenges in the coming months.
Read more: Yahoo! Finance
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