U.S. Retail Sales Drop 0.6% in July, Marking Steepest Decline Since May 2025

July retail sales fell 0.6% MoM, the sharpest drop since May 2025, as Iran war impacts energy supply and consumer confidence slides to 51.

Woofun AI data shows that U.S. retail sales declined by 0.6% month-on-month in July, representing the largest single-month decrease since May 2025 and falling short of market expectations for a slight increase. Core retail sales also dropped by 0.4%, while online sales fell by 2.2% and auto dealer sales declined, though food service and bar sales rose by 0.5%. The University of Michigan reported that preliminary U.S. consumer confidence for August fell to 51 from July's 55.2, ending a two-month improvement streak, with significant declines among older adults, low-income groups, and those without college degrees.

Additionally, the U.S. labor market weakened in July with a loss of 23,000 jobs, a drop in labor force participation to 61.4%, and slowed wage growth to 3.2%, while the unemployment rate held at 4.1%.