US Retail Sales Struggle Amid High Inflation and Interest Rates

In May, US retail sales showed minimal growth due to ongoing high inflation and interest rates. The rise was below expectations, with significant declines in specific sectors. Consumer sentiment also dropped for the third consecutive month. Despite strong job markets and wages, consumers are making selective spending choices.

PTI | Newyork | Updated: 18-06-2024 18:52 IST | Created: 18-06-2024 18:52 IST
US Retail Sales Struggle Amid High Inflation and Interest Rates
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Consumers barely increased spending in May from April as persistent high inflation and high interest rates curbed financial activities, according to the Commerce Department.

Retail sales climbed a mere 0.1% in May, missing economists' forecasts, and April's numbers were revised downward to a 0.2% decline. The retail environment remains volatile, with varying performance across different sectors and ongoing anxiety over inflated costs. In a bid to ease financial strain on shoppers, major retailers like Target and Walmart have rolled out price reductions, some temporary and others permanent, leading into the summer months.

Despite these economic headwinds, a robust job market added 272,000 jobs in May, reflecting ongoing employer confidence. Inflation is showing signs of cooling, with consumer prices, excluding volatile items, rising just 0.2% from April to May, the smallest increase since October. This indicates a complex economic landscape where consumer resilience is tempered by cautious spending, influenced largely by rising credit costs and inflationary pressures.

(This story has not been edited by Devdiscourse staff and is auto-generated from a syndicated feed.)

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