Consumers did not stock up on products last month like they did in March and April.
Retail sales fell sharply in May, driven by falling gasoline sales and economic uncertainty, the Department of Commerce reported on June 17.
Last month, non-inflation-adjusted retail sales tumbled 0.9 percent, down from the 0.1 percent dip in April.
This came in below the consensus forecast of a 0.7 percent decline and was the biggest drop since January.
According to the Commerce Department, sales at motor vehicle and parts dealers led the decline in May, sliding 3.5 percent. This was followed by building material and garden equipment suppliers (negative 2.7 percent) and gasoline stations (negative 2 percent).
But receipts at furniture stores surged 1.2 percent. Apparel retailers and online sales climbed 0.9 and 0.8 percent, respectively.
Retail sales rose 3.3 percent from a year ago, down from the 5 percent year-over-year increase in the previous month.
Core retail sales, which strip out automobiles and gas, fell at a worse-than-expected pace of 0.1 percent.
Ted Rossman, a senior industry analyst at Bankrate, attributes the consumer pullback largely to shoppers front-running U.S. tariffs.
“Americans stocked up on things like cars and furniture that they feared would soon become more expensive,” Rossman said in a statement to The Epoch Times.
“We didn’t see as much stocking up in May, in part because many tariffs were delayed or rolled back, and also because some demand that otherwise would have appeared in May was accelerated by a month or two.”
However, a measure factored into gross domestic product calculations—the retail sales control group—surged 0.4 percent, slightly higher than the market estimate of 0.3 percent. This gauge omits transactions at places like building materials suppliers and gas stations.
The new consumer figures could be the start of weakness appearing in the economic data, says Chris Zaccarelli, the CIO of Northlight Asset Management.
“Weak consumer spending this morning finally shows a connection between soft data and hard data, as the negative consumer sentiment surveys, we’ve been seeing are now showing in the month-over-month Retail Sales numbers,” said Zaccarelli in a note emailed to The Epoch Times.
Over the past few months, consumer surveys have indicated deteriorating confidence and sentiment regarding the broader economy. However, as trade policy stabilizes and the White House reaches new agreements, sentiment has improved.
By Andrew Moran
