Retail Sales Drop In July 8/25/26

Summary

July retail sales fell 0.6% month-over-month, the largest drop in a year and below economist expectations. Speakers attributed the decline partly to temporary factors, including Amazon's June Prime Day and competing retailer promotions pulling sales forward, plus higher gasoline prices. Some analysts cited inflation and a softening labor market as consumer headwinds, while Steve Liesman cautioned against reading too much into one weak print because alternative data showed decent sales.

• July retail sales dropped 0.6% versus expectations for an increase.
• Megan Shu said the disappointing retail sales report had explanatory factors.
• Simeon Gutman said Prime Day and Walmart, Target, Costco promotions pulled sales into June and away from July.
• Kitty Richards cited above-target inflation and a softening labor market as pressures on consumers.
• Steve Liesman said one weak retail report is not a big signal and alternative data showed decent sales.
• Consumer spending is closely watched because it accounts for about two-thirds of US economic growth.