[New York = E-Daily Seong Joowon Correspondent] U.S. retail sales in July fell 0.6% from the previous month. This marks the sharpest decline in 14 months, since May of last year. While this suggests that the robust consumer spending trend seen in the first half of the year has slowed somewhat, analysts note that the shift in the timing of Amazon’s “Prime Day” event was a major temporary factor.

According to the U.S. Census Bureau on the 14th (local time), retail sales in July totaled $763.6 billion (approximately 1,078.2 trillion won), down 0.6% from the previous month. This figure is based on nominal terms, which do not account for inflation. It fell significantly short of the market forecast compiled by Reuters (a 0.1% increase). Sales excluding automobiles and gasoline decreased by 0.2%.
“Core retail sales” (excluding automobiles, gasoline, building materials, and restaurants), which are directly factored into the government’s calculation of consumption expenditure in gross domestic product (GDP), also fell by 0.4%. This marks the largest decline since early 2025. The market had expected a 0.3% increase. The growth rate for June’s core retail sales was also revised downward from the previously reported 0.5% to 0.4%. In contrast, the growth rate for total retail sales in June (0.2%) remained unchanged.
Sales declined in five of the 13 sub-sectors. Sales at online retailers such as Amazon fell by 2.2%, leading the decline. Sales at auto and auto parts dealers also fell by 1.8%. Automakers reported that the number of vehicles sold had decreased. Sales at electronics and home appliance retailers also declined by 0.5%. In contrast, sales in the food service sector (restaurants and bars) rose by 0.5%, making it the only service sector to show growth in this report. Furniture store sales also increased by 0.3%.
Experts are leaning toward the interpretation that this decline is due to one-time factors rather than a sign of a slowdown in consumer spending. They note that Amazon moved its Prime Day event from July last year to June this year, prompting other retailers to launch competing discount promotions, which caused consumer spending to be concentrated in June. Stephen Brown, Chief North American Economist at Capital Economics, noted in a report, “This slowdown appears to be primarily due to a sharp drop in online sales resulting from the change in the timing of Amazon Prime Day, rather than a fundamental decline in the growth of consumer spending,” though he added, “It is true that consumer sentiment appears somewhat weaker.” Andrew Sacher, an economist at Bloomberg Economics, also noted, “While the pullback from the June Prime Day effect amplified the decline, restaurant sales—a key indicator of discretionary spending—remained solid.”
The decline in international oil prices also affected these figures. As peace negotiations in the Middle East regarding Iran alternated between progress and setbacks, international oil prices fell, leading to a decrease in gas station sales.
Economists remain cautious about consumption trends for the remainder of the second half of the year. Not only has the significant tax refund effect that supported consumption in the first half of the year run its course, but the personal savings rate in June also fell to its lowest level in four years. However, some analysts predict that the boost to consumption from rising asset values driven by the stock market rally will continue to support spending. The S&P 500 index has risen 14% this year. In a report, PNC Financial economists stated, “Households are reacting more sensitively to rising gasoline prices than in previous years, so the consumption environment in the second half of the year may be relatively less favorable,” but added, “It is difficult to envision a scenario where consumption actually declines.” They noted, “There is a growing trend among high-income and older households to cash out their asset gains to support consumption.”
According to Bank of America (BofA) card data, credit and debit card spending per household rose 5% in July compared to the same month last year. Although the rate of increase slowed compared to June (6.3%), savings levels exceeded pre-pandemic levels, and the proportion of households paying off their card balances in full each month also increased.
Meanwhile, personal consumption expenditures rose at an annualized rate of 3.2% in the second quarter, while U.S. economic growth for the same period stood at 1.5%. The consumer price index for July, released by the Department of Labor on the 12th, rose 3.4%, a slight slowdown from June’s 3.5%.
The August retail sales and employment figures, to be released next month, are seen as the next key indicators to determine whether this slowdown is a temporary pullback or a genuine turning point in consumer trends.