U.S. Retail Sales See Largest Monthly Decline Since January

📉 In a sign of cooling consumer momentum, U.S. retail and food services sales fell by 0.9% in May 2025, marking the steepest monthly drop since January, according to the Commerce Department’s Census Bureau. The decline, adjusted for seasonal variation and trading-day differences, brought total sales to $715.4 billion, down from a revised $722.0 billion in April.

🛍️ What’s Behind the Drop?

Several factors contributed to the slowdown:

• Automotive Sales Slump

  A sharp decline in motor vehicle purchases led the downturn, as consumers pulled back following earlier tariff-driven buying sprees.

  
  

• Economic Uncertainty

  Lingering concerns over inflation and interest rates may have prompted households to tighten spending, especially on big-ticket items.

  
  

• Revised April Figures

  April’s modest gain was revised to a slight decline of 0.1%, reinforcing the narrative of a gradual consumer pullback.

  
  

🔍 Sector Highlights

• Retail Trade Sales: Down 0.9% from April, but still up 3.0% compared to May 2024

• Nonstore Retailers: Up 8.3% year-over-year, showing continued strength in e-commerce

• Food Services & Drinking Places: Rose 5.3% from last year, indicating resilience in hospitality spending.

  
  

📊 Why It Matters

Retail sales are a key indicator of consumer health, which drives nearly 70% of the U.S. economy. A sustained slowdown could signal broader economic challenges ahead, especially if wage growth and employment begin to soften.

For full details, you can explore the Census Bureau’s Monthly Retail Trade Report.