U.S. Retail Spending Overview
U.S. retail spending decreased in January.
Factors cited for the decline included consumer confidence levels and cold weather conditions across parts of the country.
Key Data Points: January Decline
The Commerce Department reported a 0.2% decline in retail sales for January compared to the previous month. This represents the largest decline since May. The January figure was below economists' expectations of 0%, according to a FactSet poll. These figures are seasonally adjusted but not inflation-adjusted. The report's release was delayed due to a government shutdown.
Economic Impact
Consistent weak or declining spending could negatively impact the U.S. economy, as consumer purchases constitute approximately two-thirds of economic growth. Economists anticipate that increased tax returns may boost spending during the first half of 2026.
Category-Specific Declines
Retail sales decreased across most categories in January. Notable declines occurred at:
- Department stores: -6%
- Personal care shops: -3%
- Gasoline stations: -2.9%
Retail Sales Control Group
The "retail sales control group," which excludes volatile sales categories like building materials and gasoline, showed a 0.35% increase in January. This figure generally aligned with economists' estimates and is considered an indicator of underlying demand.