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retail sales fell 0.3% in May compared to April

Washington (awp/afp) – Retail sales in the United States fell 0.3% in May compared to April, while consumer purchasing power is sharply reduced by inflation which has reached a new record in 40 years.

This disappointed analysts, who had expected an increase of 0.2%.

Total sales were $672.9 billion, according to data released Wednesday by the Commerce Department. This amount, although down over one month, remains 8.1% higher than in May 2021 due to skyrocketing inflation.

Consumers have thus been forced to keep essential expenses for food and gasoline as a priority, the prices of which have risen particularly since the start of the war in Ukraine at the end of February.

The amount of sales recorded by food stores is thus up 1.2% over one month, that of service stations increased by 4%.

They have also forgone some expenses, as consumer credit interest rates have risen, making purchases more expensive.

Sales of cars and spare parts recorded the largest decline (-3.5%). Furniture and decoration stores, which had largely benefited from the pandemic, also recorded a decline (-0.9%), as did appliance retailers (-1.3%).

Online sellers were not spared (-1.1%).

Inflation, which had slowed in April, picked up again in May, even reaching a new high in 40 years, at 8.6%.

The American central bank (Fed) is trying to slow down this pressure on prices by raising its key rates.

This is the reason why interest rates on loans have increased, which should make it possible to moderate demand and therefore consumption.

The Fed is expected to announce another rate hike on Wednesday, which could even be the biggest since 1994.




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