U.S. Retail Sales Jump 0.9% in May, Outpacing April’s Gain as Consumer Spending Holds Strong

U.S. retail sales surged 0.9% in May, beating expectations and doubling April’s revised 0.4% increase, as government data showed broad-based consumer resilience despite persistent inflation and elevated fuel costs. The Commerce Department reported total retail and food services sales at $763.7 billion for May 2026, up from April’s $756.8 billion. Excluding gas stations, sales rose 0.7%, with gains across clothing, accessories, furniture, and online retail (+1.5%). Core retail control group—excluding autos, gas, food services, and building materials—climbed 0.7%, signaling solid underlying demand. The report follows a 4.2% year-over-year rise in consumer prices for May, the highest in three years, driven partly by gasoline costs tied to geopolitical tensions. Gas prices dipped to $4.02 per gallon, down 11% from a month ago but still above $4 since March. Economists credited strong hiring and government tax refunds for propping up spending, though they warned momentum may fade as fiscal support wanes. Weak spots included electronics/appliance stores and department stores, both posting slight declines. Restaurant sales dipped 0.1%. Analysts noted that while a tentative Iran war deal could ease oil supply constraints, recovery may take time. Meanwhile, shoppers continued shifting fuel purchases to big-box chains offering discounts, a trend that began during the recent price spike. The data, released June 17, 2026, offers a snapshot of spending but excludes travel and lodging. Nationwide Chief Economist Kathy Bostjancic highlighted the role of tax refunds and job growth in buffering higher gas prices, though she cautioned that fading support and persistent inflation could slow momentum ahead.