Key Takeaways
- The National Retail Federation reported Friday that core retail spending fell in June for the first time since February.
- The trade group thinks consumers are adopting a cautious attitude because of uncertainty about tariffs, trade policy, and the economy.
- But import taxes have yet to make a significant impact on many prices, Oppenheimer analysts said, adding that increases remain “forthcoming.”
Retail sales fell last month as consumers worried about tariffs, according to a new report, even as some analysts say widespread price increases are yet to hit stores.
Core retail spending, which excludes restaurant, car, and gasoline bills, fell 0.3% from May to June, according to the National Retail Federation, but rose 3.4% year-over-year. That marked the first month-over-month decline since February, according to the trade group.
Americans may be taking a “wait-and-see approach” because they’re uncertain about how tariffs and trade policy will affect the economy, NRF President Matthew Shay said.
Additional insight is expected Thursday, when the government is slated to release June retail figures.
Impact on Consumers’ ‘Psyche’ Noted
“Economic fundamentals haven’t been disrupted yet and shoppers still have the ability to spend on priorities, but the economy is gradually slowing and there has been an impact on the psyche of consumers,” Shay said.
Spending fell month-over-month in all but one category: digital books, games, and other products, according to the trade group.
Oppenheimer, which has been monitoring a basket of items seen as likely to be subject to tariffs since April, has seen “limited shifts in discretionary retail goods pricing, the firms analysts wrote Friday. Oppenheimer in a new research note said at 13 of 19 companies it covered, only a few prices moved higher, and many were flat or even fell.
Still, companies see price increases as a “key tariff-mitigation measure,” and changes are “forthcoming,” the note said.
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