Retail sales unexpectedly fall in July as government tax refunds fade

U.S. retail sales fell 0.6% in July, the Commerce Department reported Friday, reversing a revised 0.2% gain in June and marking the biggest decline since May 2025. After Prime Day and World Cup spending, Americans cut back by the largest amount in more than a year, raising concerns about how resilient consumers remain amid still-high inflation and gasoline prices. The report also followed slower-than-expected jobs data last week, feeding worries that the economy could be slowing after strong first-half spending. July prices weren’t adjusted for inflation and were influenced by a 0.9% drop at gas stations, where AAA said fuel rose late in the month to $4.08 a gallon.