Latest Updates

• US Retail Sales: July 2025 2025-08-15 08:30
  

  US retail sales data in July pointed to a continuation of strength in consumer spending. Total retail sales increased 0.5% MoM in July, which was in line with what analysts expected, but the more surprising news was an upward revision in the June data that showed that monthly retail sales growth was a robust 0.9% MoM, up from the 0.6% MoM in the initial estimate. The strength fades a bit when excluding autos and gas. Retail sales excluding those categories were up just 0.2% MoM in July, a more substantial slowdown from the 0.8% MoM increase in June. Still, the near-term trend is robust. Sales ex gas and autos in the May to July period were 1.0% higher than in the February through April period. The bottom line is that even though retail sales growth has been volatile recently, the momentum appears to be holding up well as the nominal annual gain is still hovering around 4% YoY.

  

  Here are some notes on key retail segments:

  • Auto sales were the main force behind the headline gain as they increased 1.7% MoM in July, adding to the 1.6% MoM increase in June. However, these strong gains are a bit of a rally from the drop in sales that followed the tariff front-running in Q1. On an annual basis, auto sales are still growing at a healthy 4.7% YoY and not showing signs of capitulation.
  • Non-store sales, the second largest retail category behind auto sales, were up 0.8% MoM and 8.0% YoY. The growth here was another reason for the strong headline number as e-commerce sales continue to drive consumer spending higher.
  • Food & drinking services, down -0.4% MoM, were the primary dampener to spending growth. This affected the headline number, but is excluded from the retail trade total, which grew a robust 0.7% MoM. Even though there was a monthly decline, food & drinking services spending is still up 5.6% YoY.
  • Broadly, most of the other categories saw sales higher in Jul,y with the largest gains in furniture (+1.4% MoM), sporting goods (+0.8% MoM), and clothing (+0.7% MoM). Interestingly, many of these segments would be sensitive to the rise in tariff rates on imported consumer goods, so it is safe to say that tariffs (and the modest increases in goods prices that have come so far) have not deterred consumers from buying goods.
  • Building materials, down -1.0% MoM, and electronics & appliances, -0.6% MoM, look a bit like outliers. These categories might be a reflection of weakness in the real estate market, which is finding it difficult to cope with high interest rates.
• US Retail Sales: June 2025 2025-07-17 08:30
  

  US retail sales rose 0.6% MoM in June, well above the 0.1% MoM consensus forecast, partially reversing the -0.9% MoM drop in May. Sales were up 0.5% QoQ and 4.1% YoY in Q2 2025, with core retail sales (ex-auto and gas) also increasing 0.6% MoM and accelerating to a 1.1% QoQ gain.

  • Motor vehicle and parts sales rebounded 1.2% MoM after a -3.8% MoM drop in May, and were up 6.5% YoY in June.
  • Gasoline sales were flat MoM, but down -3.3% QoQ and -5.6% YoY in Q2, reflecting weak oil prices.
  • Nonstore sales rose 0.4% MoM and 1.5% QoQ, the strongest quarterly gain among goods segments.
  • Food services & drinking places were up 0.6% MoM and 2.5% QoQ, the highest among all categories.
  • Discretionary goods like electronics (-0.1% MoM), furniture (-0.1% MoM), and sporting goods (+0.2% MoM) were soft but had minimal impact on the headline due to their small weight.
• US Retail Sales: May 2025 2025-06-17 08:30
  

  The May US retail sales report showed a soft consumer in the early months of the second quarter of 2025. In May, overall retail sales were down -0.9% MoM, coming in weaker than the expected drop of -0.7% MoM. In addition to the weak May print, the Census Bureau revised down the slight April gain of 0.1% MoM to a slight decline of -0.1% MoM. The drop in the headline sales total was caused by large declines in the auto & parts and gas segments which were down -3.5% MoM and -2.0% MoM, respectively. While both data points look weak, they were not necessarily a result of consumer weakness.

  • Auto sales had surged at the end of Q1 2025 due to consumers front running tariffs, and the decline in May is a result of that force dissipating. On an annual basis, sales are still up 2.5% YoY, and sales in the last three months are still up 6.7% over the same three month period last year.
  • Gas sales continue to be affected by weak gas prices. In the May CPI report, the gasoline CPI index fell -2.6% MoM suggesting that all of the -2.0% MoM decline in gas sales could be attributed to the effects of prices. Indeed, gas prices have yet to see their typical seasonal rise so May retail gas station sales are down -6.9 YoY (the same annual comparison as April).

  

  Excluding auto and gas sales, May retail sales were only down -0.1% MoM and, on an annual basis, were up 4.6% MoM. The segments counted in this total were mixed, but the larger categories dropped while the gains were seen in the smaller categories. For example, two of the larger core segments, food & drinking places (-0.9% MoM) and food & beverages (-0.7% MoM), saw significant declines which were only partly offset by rises in furniture (+1.2% MoM), sporting goods (+1.3% MoM), and miscellaneous sales (+2.9% MoM). Non-store sales was the only major retail segment that posted a significant gain, up 0.9% MoM. Overall, the core segments negate some of the pessimistic sentiment elicited by the headline move, but generally consumption continues to get gradually softer.
• US Retail Sales: April 2025 2025-05-15 08:30
  

  US retail sales in April increased just 0.1% MoM, a sharp slowdown in consumer spending following the 1.7% MoM increase in March (which was actually revised up from 1.5% MoM). Despite the slowdown, the small increase was a slight beat over expectations that there would be no growth in sales. Both auto and gas sales weighed down the headline number:

  • Motor vehicle and auto part retail sales fell -0.1% MoM in April, keeping the overall sales subdued due to its heavy weight. However, the small decline in auto & parts sales is actually a bit of a surprise as sales surged in March, up 5.5% MoM. That means that consumer spending on autos was remained strong in April with an annual increase of 9.4% YoY.
  • Gas sales fell -0.5% MoM in April as weak oil prices continue to keep spending on gasoline low. In the three months to April, gas sales are down -1.1% compared to the previous three months and down -3.9% YoY. Energy commodity prices will have to bounce before this segment of sales can recover.

  The core segment of sales that excludes autos and gas saw a slightly stronger increase of 0.2% MoM. The performance across segments was generally mixed with the strongest gains in food services & drinking places (+1.2% MoM) and building materials & supplies (+0.8% MoM) offset by declines elsewhere. The large non-store segment only increased 0.2% MoM but was still at a healthy 7.5% YoY gain. The sharpest declines were seen in sporting goods & hobbies (-2.5% MoM) and miscellaneous stores (-2.1% MoM) which look to be reversals of strong March gains.

  Overall, the April retail sales report is not much of a surprise given the strong gain in March. Consumers were always going to slow from the pacey spending growth fueled by tariff front-running, so we shouldn’t look too much into the monthly numbers as a sign of consumer weakness. In fact, many segments reported strong annual rates because there wasn’t much of a reversal of the March spending growth, so the report actually looks a bit stronger in that light.
• US Retail Sales: March 2025 2025-04-16 08:30

  US retail sales bounced back strongly to end the first quarter of 2025 after January spending was hampered by bad weather and February sales disappointed. The strong result is not a clear signal of economic strength, however, as it’s likely that the jump in sales was driven by consumers picking up spending ahead of tariffs, especially in the auto segment. Instead, quarterly growth rates point to a weaker result of a slow decline in consumption growth.

  Headline Retail Sales

  

  US retail & food services sales posted a strong result in March, surging 1.4% MoM and beating expectations of a 1.3% MoM gain. The monthly increase is the strongest since January 2023 and is considered a rebound from the weak results in the first two months of the year. When looking at the first quarter as a whole, retail sales were only up 0.3% QoQ.

  The jump in sales in March was driven by a strong increase in auto sales. Retail spending on autos and auto parts surged 5.3% MoM and was up 8.8% YoY. The move was a result of two major factors. First, January and February auto sales were notably weak, so a rebound to close Q1 was largely expected. Second, consumers looked to front-run the 25% tariff on auto imports that Trump announced would be put in place in April. So what we’re seeing here is a largely secular move higher that is likely to be reversed in April. Auto sales in Q1 as a whole were still weak despite the March surge, falling -0.9% QoQ.

  Offsetting the large increase in auto sales was a large decline in gas station sales. The -2.5% MoM drop was caused by oil prices falling in March and causing a similar decline in gas prices (-6.3% MoM according to March CPI). The annual change in gas station sales flipped to a decline of -4.3% YoY in March, and for the quarter as a whole, was -0.7% YoY.

  Core Retail Sales

  

  When excluding both gas sales and auto sales, retail sales still posted a strong increase, up 0.8% MoM, which actually matched the core sales increase in February. Notably, only one of the core retail sales subsegments saw a decline in March, and the rest saw some kind of increase. The core segment results inspire a little bit more confidence in the consumption picture. When excluding the weak auto segment, core retail sales were up 0.6% QoQ in the first quarter.

  

  • The building materials & garden equipment segment was the core segment with the largest increase in March, up 3.3% MoM. This was the largest MoM gain in four years and a reversal from five straight monthly declines. I suspect there was some tariff impact here combined with a positive change in the weather in March vs January and February. Weakness in the first two months meant that building materials sales were still down -1.6% QoQ, the largest quarterly drop since Q2 2023.

  

  • Food services & drinking places was another segment with a strong bounce, up 1.8% MoM, posting its largest monthly increase since January 2023. This segment was notably weak in February when it dropped -0.8% MoM, and the strong end to Q1 brings the quarterly increase to 0.2% QoQ. Like the building materials segment, I think the bounce here was partly driven by weather, but there are also more signs of consumer strength here because tariffs likely didn’t impact this segment much.
  • Core segments that may have been impacted by tariffs include electronics (+0.8% MoM), sporting & hobby goods (+2.4% MoM), health & personal care (+0.7% MoM), and general merchandise (+0.6% MoM). It’s likely that without the tariffs, these segments would have been closer to flat.
  • Nonstore retail sales were one of the weakest categories in March, up just 0.1% MoM, but that followed a surge of 3.2% MoM in February. Interestingly, there wasn’t much of a response in this category to tariffs.
  • The sole segment posting a decline was furniture sales, down -0.7% MoM. Despite the drop, sales in this segment were still up 7.7% YoY, and they increased 0.9% QoQ.

  NRF Retail Monitor

  

  The NRF Retail Monitor, released a few days before the Census report, saw retail sales (ex autos and gas) growth a bit weaker in March at 0.6% MoM. The main deviation was in the building & garden supplies segment, which, according to the NRF, saw sales down -0.81% MoM, not a jump of 3.3% MoM. It was also more pessimistic on electronics sales (-0.29% MoM) and health & personal care (-0.44% MoM). One thing that was consistent across both reports was the strong performance in food services & drinking places, which the NRF reported up 1.48% MoM. In general, the NRF report presents a smoother view of sales than the Census report, where the February drop was smaller and the March gain was weaker.

  

  Overall, it’s hard to take much away from the March retail report because of the volatility in Q1 due to weather and the impact of tariff front-running on the March numbers. A trend is more visible when looking at quarterly trends. The increase of retail sales excluding autos and gas slowed to about 0.56% QoQ in Q1 2025, the lowest since Q1 2024 and a clearer signal that consumption growth is gradually slowing. If tariffs are in place throughout Q2, I expect that to have a dampening effect on goods sales growth through higher prices and weaker personal income (through lower wage growth and/or higher unemployment).
• US Retail Sales: February 2025 2025-03-17 08:30

  February retail sales hits with another soft reading of consumption after the significant decline in January. This time, there was a slight increase in retail sales of 0.2% MoM, but it was below expectations of a stronger bounce of 0.6% MoM. The weakness was a result of another month of sluggishness in auto sales as other segments looked better. Regardless, the market is forced to contend with the possibility that the consumer really is fading away and what that means for growth.

  Headline Retail Sales Totals

  

  The headline reading of retail & food services sales increased 0.2% MoM in February, failing to post a significant recovery from a weak January and a sizeable miss from an expected increase of 0.6% MoM. The figure is even more disappointing when considering the fact that the January decline was revised down from -0.9% MoM to an even worse -1.2% MoM. This means that the seasonally adjusted total for February of $722.7 billion was actually a decline on the initial January estimate made last month of $723.9 billion. When looking at the details, the sales figures look slightly better.

  The weak February print can be attributed to a -0.4% MoM decline in auto sales in February which failed to bounce from the -3.7% MoM decline in January. When excluding this segment, retail sales were up 0.3% MoM, a slightly smaller miss from the expected 0.4% MoM increase. This aggregate includes a -1.0% MoM decline in gas sales which was caused by a decline in gas prices in March. When excluding gas sales and autos, retail sales growth was up a rosier 0.5% MoM which actually beat expectations for that segment and was a better bounce from that segment’s decline of -0.8% MoM in January.

  Segment Details

  

  The details of the retail sales were indeed quite mixed with some segments bouncing from January weakness and others maintaining it:

  • The nonstore retail sales segment was one of those segments on a bounce, up 2.4% MoM in February after a -2.4% MoM decline in January. With this segment being the second largest, it played a major part in offsetting the weak auto results and pushing the headline indexes into positive territory.
  • The third largest segment, food services & drinking places, maintained its January weakness, down -1.5% MoM in February after no growth in January. This challenges the validity of the conjecture that January retail sales data was caused by exceptionally cold weather as there would probably be a recovery in this segment if that were the case. The annual increase of food services sales is now just 1.5% YoY, the weakest since the US completely opened up after the pandemic in February 2021.
  • Food & beverage sales (+0.4% MoM) and general merchandise sales (+0.2% MoM) maintained low stable rates with the latter trending a bit weaker than the former. Grocery store sales were up 0.4% MoM which was likely helped by rising food prices.
  • Health & personal care sales was another segment that saw a strong rebound. The segment was up 1.7% MoM in February, reversing the -1.1% MoM decline in January. In the last three months, sales increased 5.3% compared to the Sep-Nov period where sales were only up 0.2%.
  • Some weak segments that maintained weakness from January: sporting goods & hobbies down -0.4% MoM in February and -3.1% MoM in January, electronics down -0.3% MoM in February and -1.1% MoM in January, and furniture 0.0% MoM in February and down -1.2% MoM in January. Notably, there are all discretionary segments that would be sensitive to cyclical changes in the economy.

  Early Retail Sales Readings

  

  Early readings of retail sales had confirmed that February would be a weak report for retail sales. The NRF’s Retail Monitor reported retail sales (ex gas and autos) down -0.2% MoM February with significant declines in building & garden supplies (-1.0% MoM), furniture (-1.0% MoM), and clothing (-0.8% MoM). Additionally, the Chicago Fed CARTS nowcast pointed to an even sharper decline in the retail & food services sales (ex-auto) segment of -0.8% MoM. Both appeared to be too pessimistic because they missed the surge in nonstore sales, but the general soft sentiment was there early.
• US Retail Sales: January 2025 2025-02-14 08:30
  

  US retail sales were down -0.9% MoM in January, a big miss from -0.1% MoM expected and well below the 0.7% MoM increase in December (revised up from 0.4% MoM).

  • Excluding gas and motor vehicle sales, retail sales were down -0.5% MoM.
  • Motor vehicle sales weighed heavily, down -2.8% MoM.
  • The strongest categories were gas sales, up 0.9% MoM on higher prices, and food services & drinking, up 0.9% MoM despite cold weather during the month.
  • Most retail goods segments had a weak month with large declines in furniture (-1.7% MoM), building material & supplies (-1.3% MoM), clothing (-1.2% MoM), and sporting goods & hobbies (-4.6% MoM).
  • Nonstore retail also saw a weak month, down -1.9% MoM.
  • Many of the goods declines followed strong increases in December suggesting there was a larger-than-usual hangover following the holiday retail season.
• US Retail Sales: November 2024 2024-12-17 08:30
  

  US retail sales increased 0.7% MoM in November, up from 0.4% MoM in October and above expectations of an 0.5% MoM increase. Ex-auto sales were up only 0.2% MoM, below expectations of an 0.4% MoM increase. Auto vehicle & parts sales, thus, saw a strong increase of 2.6% MoM, driving the headline gains. The YoY increase in nominal retail sales at 3.8% YoY is the highest since December 2023 after today's strong increase in auto sales fueled a headline beat.

  

  Sales were muted in other categories with furniture up just 0.3% MoM, electronics up 0.3% MoM, health & personal care flat, and gas sales up 0.1% MoM. Food & beverage, clothing, general merchandise, and food services & drinking all saw small declines. Outside of autos, the strongest segment of sales was nonstore retail sales, up 1.8% MoM and 9.8% YoY (the highest annual growth across all segments).