United States: Retail sales contract in July
Latest reading: Nominal retail sales declined 0.6% in seasonally adjusted month-on-month terms in July, following a 0.2% rise in the previous month. July’s reading was the weakest since May 2025 and contrasted market expectations for an expansion.
Relative to the previous month’s figures, readings in July softened for motor vehicle and parts dealers (-1.8% on a seasonally adjusted month-on-month basis vs +2.4% in June) and non-store retailers (-2.2% vs +0.9% in June). In contrast, readings picked up for food and beverages (0.0% vs -0.1% in June), general merchandise stores (+0.3% vs +0.2% in June) and gasoline stations (-0.9% vs -5.8% in June).
On a year-on-year basis, retail sales rose 5.0% in July, following 6.8% growth in the previous month.
Panelist insight: Digging deeper into the data, Nomura analysts said:
“Nominal control retail sales fell 0.4% m-o-m from a downwardly revised 0.4%, driven by weakness in nonstore retailers component (-2.2% m-o-m). As we flagged, this was likely due to negative payback after Prime Day sales boosted this component in June. Overall, we think that temporary factors that boosted spending in Q2 waned and weighed on spending in July. That said, we still see it as a modest payback rather than an onset of deterioration in demand.”