US Retail Sales Fall 0.6% in July, Snapping Nine-Month Run of Gains
AI Market Summary
US July retail sales fell 0.6% m/m versus expectations for a gain, ending a nine-month expansion and reinforcing a deterioration in consumer momentum alongside weaker Michigan sentiment. Markets responded with lower Treasury yields and a softer dollar as growth expectations were revised down and September Fed hold odds increased. Near-term, this data raises downside risk for cyclical assets while supporting rate-sensitive positioning.
Impact level
● High
Affected assets
NCSIDXY2USD/USDT-0.19%
AI Insight · NCSIDXY2USD/USDTAI Insight
▼ Bearish
Trade now
⚠️ AI-generated insights are based on news content and are provided for informational purposes only. They do not constitute investment advice or represent the views of BingX. Investing involves risk. Please trade responsibly.
US retail spending pulled back in July, signaling a pause in consumer momentum. Retail sales fell 0.6% from the prior month, Commerce Department Census Bureau figures released Aug. 14 showed. It was the first monthly decline in nine months and the sharpest drop since May 2025.
Economists had forecast a 0.1% increase. Instead, sales totaled $763.6 billion, a miss that pushed Treasury yields lower, weighed on the dollar and led Wall Street firms to start cutting growth outlooks.
Spending weakness was broad-based. Nonstore retailers" sales dropped 2.2%, while motor vehicle and parts dealers fell 1.8%. Gas stations posted a 0.9% decline, and electronics and appliance stores slipped 0.5%.
Core retail sales"a measure that excludes autos, gasoline, building materials and food services"fell 0.4%. The Street had been looking for a 0.3% gain. Some categories still advanced: clothing stores rose 1.9%, and food services and drinking places increased 0.5%. The previous month had shown a 0.2% rise. On a year-over-year basis, retail sales remain up 5.0%.
Consumer sentiment data pointed in the same direction. The University of Michigan"s preliminary August reading fell to 51.0 from 55.2 in July, ending a two-month improvement streak. Consumer spending accounts for roughly two-thirds of US GDP, and several major firms, including Goldman Sachs and BMO, have trimmed third-quarter GDP growth estimates following the retail report.
Markets are now pricing in about a 69% chance the Federal Reserve keeps interest rates unchanged at its September meeting. Treasury yields fell immediately after the data, and the dollar softened.
