WASHINGTON, July 18 (Reuters) – U.S. retail sales rose less than expected in June, though consumer spending appeared to be solid, which likely kept the economy afloat in the second quarter.
Retail sales increased 0.2% last month, the Commerce Department said on Tuesday. Data for May was revised higher to show sales gaining 0.5% instead of 0.3% as previously reported.
Economists polled by Reuters had forecast retail sales gaining 0.5%. Retail sales are mostly goods and are not adjusted for inflation. Food services and drinking places are the only services category in the retail sales report.
Spending has remained resilient despite 500 basis points worth of interest rate hikes from the Federal Reserve since March 2022, when the U.S. central bank kicked off its fastest monetary policy tightening cycle in more than 40 years.
A tight labor market continues to boost wage gains while some households still have savings accumulated during the COVID-19 pandemic. Consumers’ purchasing power is also gradually improving as inflation subsides.
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Source: www.reuters.com
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