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U.S. retail sales fall in July for first time in nine months
Retail sales dropped 0.6% in July, with nonstore retailers, auto dealers, electronics stores, and service stations all reporting declines.
U.S. retail sales fell in July for the first time in nine months, extending signs that consumer spending momentum is fading as the boost from big tax refunds wears off, according to data from the Commerce Department reported by Reuters.
The decline came after Amazon pulled forward its Prime Day event to June from July, and other retailers ran competing promotions. A drop in gasoline prices also weighed on receipts at service stations.
Retail sales decreased 0.6% last month after a 0.2% gain in June, marking the first contraction since last October and the largest move in 14 months. Economists polled by Reuters had expected sales to rise 0.1%, and the report showed year-over-year sales growth of 5.0% in July.
The report cited weakness across multiple categories, including a 2.2% fall in receipts at nonstore retailers, a 1.8% drop at motor vehicle and parts dealers, a 0.5% decline at electronics and appliance stores, and a 0.9% fall at service stations as pump prices eased. Reuters said the data added to expectations that the Federal Reserve would stay on hold in September unless August price and employment surprises change the outlook, with BMO Capital Markets economist Sal Guatieri pointing to a material slowdown in real consumer spending growth in the third quarter.
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