US retail sales weakest in over a year in July

US retail sales weakened significantly in July, with total sales falling 0.6 percent compared to the previous month, reaching $763.6 billion, according to the US Department of Commerce. The decline was most notable in auto dealers and online stores, where sales decreased by 1.8 percent and 2.2 percent respectively. Analysts had anticipated a modest increase of 0.1 percent.

Experts suggest that this decline may signal fatigue among American consumers, as they grapple with high inflation and reduced savings. Inflation has been driven up by higher gasoline prices, following US-Israel strikes against Iran that disrupted traffic in the Strait of Hormuz. Despite a cooling in gasoline prices in July, consumer spending remained cautious.

Major retail categories such as motor vehicles and parts saw a decline of 1.8 percent, while grocery stores experienced a slight decrease. Online store sales dropped by 2.2 percent. However, retail sales still managed to increase five percent compared to the same period a year ago.