U.S. retail sales saw a modest increase of 0.1% in May from April, according to the Census Bureau’s report on Tuesday. This rise fell short of the 0.2% growth anticipated by economists surveyed by Dow Jones Newswires and The Wall Street Journal. Compounding the underwhelming results, April’s sales figures were revised downward, showing a 0.2% decline instead of the previously reported flat performance.
This data suggests potential shifts in consumer behavior, as Americans grapple with the pressures of inflation and high interest rates. The marginal increase in retail sales may signal the start of a downturn in consumer spending, which has been a critical driver of the economy during the pandemic recovery period.
Wells Fargo economists Tim Quinlan and Shannon Seery Grein noted, “Overall, the May retail sales data are consistent with a consumer that is only gradually losing its swagger.”
As consumers face tighter budgets, the economic landscape may continue to see adjustments in retail performance, reflecting broader financial constraints and shifts in spending patterns.
