Shoppers in the USA reduced their purchases in July more than expected due to fears over the rising of the delta variant of Covid-19 and drying up government stimulus.
Retail sales for July fell 1.1%, worse than the estimate of a 0.3% drop.
Sales declined 0.4% excluding automobiles, as per the Commerce Department figures released on Tuesday.
Gus Faucher, the Chief U.S. economist at PNC, said, “Although retail sales fell in July, the outlook for consumer spending remains positive. However, spending growth will shift from goods to services over the next couple of years, limiting growth in most categories of retail sales.”
Consumers make up to almost 70% of all activity in the USA. Therefore, retail sales are watched more closely as an indicator of overall economic health.
Though July saw a decline in retail sales, the $617.7 billion in sales still represents an acceleration of 15.8% from the same time a year ago.
