Retail sales in the United States fell by 0.6% in July, marking the weakest performance in over a year and falling short of analysts' expectations for a 0.1% increase. Excluding gas stations and auto dealers, sales still declined by 0.3%. Sales at auto dealers decreased by 2%, while gasoline station sales dropped by 0.9%, and electronic and appliance store sales fell by 0.5%.
Some factors contributed to the decline, including Amazon's earlier Prime Day event, which resulted in a 2.2% drop in online sales. Additionally, most World Cup games occurred in June, which may have artificially inflated retail sales figures for that month, leading to a perceived decline in July.
Despite these factors, the overall retail sales numbers indicate a slowdown in consumer spending, raising concerns about the strength of consumer demand in the latter half of the year. The retail sales control group, which directly influences GDP calculations, fell by 0.4% in July, compared to a forecasted gain of 0.3%. Kathy Bostjancic, chief economist at Nationwide, noted that the weaker retail sales report suggests consumers took a break after a strong spending period in the first half of the year. While the stock market remains strong and gasoline prices have decreased, the July retail figures do not indicate a significant acceleration in consumer spending.