US Retail Sales Rebound as Consumers Navigate a ‘Wait-And-See’ Economy

Retail spending in the United States showed signs of resilience in June, with sales rising 0.6% from May and climbing 3.9% versus the same month a year ago, according to data released Thursday (July 17) by the U.S. Census Bureau. The report, based on a survey of roughly 4,800 firms, marks a partial recovery from two months of declines, but hints at changing consumer priorities as Americans navigate higher prices and ongoing tariff uncertainty.

June’s upturn reverses recent weakness. Retail sales dipped by 0.9% in May and 0.1% in April. But the latest reading, as interpreted by PYMNTS Intelligence, is not as straightforward as it appears. Not only do the numbers reflect the raw value of transactions rather than the volume of goods being purchased, but some of the month’s strongest categories may owe their gains to price increases rather than to shoppers filling more carts.

For example, motor vehicle and parts dealers registered a 6.5% jump in year-over-year sales, and health and personal care stores surged by 8.3%. These gains exceeded the 12-month price increases in related consumer price index (CPI) categories, suggesting there’s real growth beyond mere inflation. Yet, in some segments, particularly those feeling the pinch from tariffs, the growth masked underlying caution. Clothing and accessories sales climbed 3.9%, while prices for apparel actually fell over the past year.

Dining and entertainment venues provided a bright spot. Drinking places such as bars and nightclubs posted a 6.6% annual gain, and restaurants led a 3.5% uptick for broader food services, even as prices for food away from home rose 3.8% over the same window. Non-store retailers — an umbrella that includes eCommerce — gained 4.5% year-over-year, slightly outpacing broader retail trade.

While the headline from June’s report suggests an American shopper weathering economic turbulence, retail analysts are quick to identify underlying fragility.

“Don’t count the American consumer out yet. There’s still a lot of trepidation about tariffs and likely price hikes, but consumers are willing to buy if they feel they can get a good deal. The word of the summer for the economy is resilient,” said Heather Long, Chief Economist at Navy Federal Credit Union. She emphasized that low layoffs and continued job security are keeping spending afloat, even if buyers remain bargain-conscious.

“While tariffs have grabbed the headlines — and have caused a great deal of uncertainty — they have not hit the retail sector with full force,” said GlobalData Managing Director Neil Saunders. “Most of this is because the deadlines for tariffs to be imposed have been constantly moved, and most stock being sold in the half was not subject to additional levies. The question … is whether the reasonable first half performance continues into the second half. With tariff deadlines now looming, inflation coming in hotter, and a range of economic pressures stacked up, there is every likelihood that performance will moderate — especially in volume terms.”

A deeper look at the numbers — and at PYMNTS Intelligence’s analysis — suggests Americans are adjusting habits rather than dramatically opening or closing their wallets. Many are opting for more affordable brands or trimming back discretionary purchases, behaviors reinforced by fresh shifts in product pricing and availability.

Survey data referenced by PYMNTS reveal that over one-third of consumers are purchasing less overall. A similar share are buying smaller quantities, and nearly a third report cutting back on activities like dining out or travel. The changes reflect not just rising sticker prices, but persistent unease about the direction of tariffs, inflation, and the broader economy.

Looking forward, retailers and analysts alike are bracing for more volatility. While solid wage growth and job stability have so far underpinned consumer confidence, emerging macro headwinds — from ongoing tariff debates to lingering inflation and a cooling jobs market — could rein in momentum. For now, the story remains one of adaptation: resilient spending alongside subtle but significant shifts in how, and where, Americans choose to spend their dollars.

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