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Retail sales up a modest 0.2% in June amid uncertainty
Business at clothing and accessories stores slipped 0.3%
Key Takeaways:
- U.S. retail sales rose 0.2% in June after a revised 1% gain in May as shoppers moderated spending amid economic uncertainty.
- Online sales increased 1.9% on Amazon Prime Day activity while lower gas prices and cooling inflation helped support consumer spending.
- Upcoming earnings reports from Walmart, Target and Macy’s may offer further insight into consumer behavior as inflation and energy risks persist.
NEW YORK — Shoppers slowed their spending in June from May amid continuing economic uncertainty and fading benefits from generous government tax refunds.
Retail sales rose 0.2% in June, after being up a revised 1% in May, according to the Commerce Department's report July 16. Excluding business at gas stations, retail sales rose a robust 0.7%
Business at clothing and accessories stores slipped 0.3%, while online sales rose 1.9%, fueled by spending surrounding Amazon's Prime Day event June 23-26. Business at sporting goods, hobby, musical instrument and book stores was up 1.3%, helped by spending around the World Cup.
The data offers only a snapshot of consumer spending and doesn’t include activities like travel and hotel stays. The lone services category — restaurants — registered a 0.1% increase.
The report comes as U.S. inflation cooled last month as the cost of gas, clothes, and used cars fell, offering some relief to consumers, while underlying price pressures also slowed more than anticipated.
U.S. retail and food services sales for June 2026 were $768.6 billion, up 0.2% from May 2026.
🛍️ https://t.co/p65hcrjkOx #CensusEconData #RetailSales pic.twitter.com/8uPB37w67F — U.S. Census Bureau (@uscensusbureau) July 16, 2026
Gas prices fell to $3.94 per gallon on July 16, down from $4.04 a month ago, according to motor club AAA.
The Labor Department said July 14 that consumer prices dropped 0.4% from May to June, the largest monthly drop in four years, after increasing 0.5% in the previous month. On a yearly basis, inflation declined to 3.5%, down from a year-over-year gain of 4.2% in May and lower than many economists expected.
The core inflation figures suggest that the gas price spike from the Iran war, while it pushed up airfares and some other costs, hasn’t so far led to broad-based, sustained inflation, according to economists. But the United States renewed attacks on Iran and President Donald Trump announced a new blockade in the Strait of Hormuz, a key shipping route for about one-fifth of the world’s oil. The increase threatens to unravel at least some of the progress that occurred last month.
Next month, major retailers including Walmart, Target and Macy’s are slated to report their second-quarter earnings reports, which will offer some insight into shopping behavior.
A report last month from the Conference Board showed that Americans’ attitudes toward the economy improved slightly this month as gas prices declined, but their outlook is still mostly negative by historical standards.
Sarah Williamson, 27, a software support engineer in Raleigh, N.C., said that over the last year or so, she’s more conscious of how she spends her money. She feels financially secure given her stable job, but increasing costs of food and gas are making her pull back on frivolous spending.
“I shop less overall as a hobby,” she said.
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Williamson noted that at the supermarket, she avoids buying pre-cut fruits like cantaloupe, which tend to be more expensive than buying the whole cantaloupe, to save money, and is careful about buying clothing for herself. She recently bought a dress for $30, including shipping costs, on the TikTok shop and a cotton nightgown for $72 on Amazon including shipping fees. The price for the nightgown was more than she normally spends, but she figured the price was worth it since she wears it a lot.
Brian Reynolds, CEO and founder of Just For Teens, a skin care line aimed at preteens and teens, noted that his low-price products, which include $5 pimple patches, are aimed at families who are on a budget and are in the sweet spot of retailing right now.
By October, his brand will be expanded to 10,000 Dollar General stores, up from about 4,000 late last year. He said sales have been decent so far, but he expects that business will see more of a momentum for the back-to-school selling season.
“There’s a lot of space for products that are everyday essentials that are value-priced,” he said.
