Summary
- U.S. retail sales in May fell by 0.9% from the previous month, marking the biggest drop so far this year.
- It was noted that sales of automobiles and parts, as well as building materials for home use, fell sharply.
- Due to factors such as tariffs and high interest rates, U.S. consumer spending has contracted, so caution regarding future investments is advised.
Down 0.9%...Impact of tariffs
U.S. retail sales in May recorded the largest monthly decline so far this year. Analysts say consumers are cutting back spending as a result of tariffs.
According to an announcement by the U.S. Census Bureau under the Department of Commerce on the 17th, U.S. retail sales in May fell by 0.9% from the previous month to $715.4 billion. This missed the expert forecast compiled by Dow Jones (-0.6%). This is the biggest monthly decrease since the beginning of the year. The April retail sales figure was also revised down, from '0.1% increase' to '0.1% decrease' compared to the previous month. This marks the first time since the end of 2023 that retail sales have fallen for two consecutive months.
By item, auto and parts sales plummeted 3.5% compared to the previous month, leading the overall decline. Sales of building materials and garden supplies for home use also fell by 2.7%. The decline in spending is interpreted as a result of tariffs imposed by the Donald Trump administration. Bloomberg News warned, "So far, tariffs have not fueled U.S. inflation, but rising living costs and high interest rates are worsening American household finances as consumer confidence weakens."
Dong-Hyun Kim 3code@hankyung.com
Korea Economic Daily
hankyung@bloomingbit.ioThe Korea Economic Daily Global is a digital media where latest news on Korean companies, industries, and financial markets.
