U.S. retail sales growth hits slowest pace in nearly a year
Retail sales growth in the U.S. slowed to its weakest rate in nearly a year during October, with total spending reaching $561.7 billion.
U.S. retail sales rose at their slowest pace in nearly a year in October. Total spending reached $561.7 billion on a seasonally adjusted basis.
This was the 13th consecutive month of gains. For the first ten months of the year, retail sales were up 5.75 percent. The slowdown in growth, however, points to shifting consumer confidence as inflation persists.
Consumer caution amid high prices and inflation
The monthly growth rate was the lowest since November 2025. It reflects growing consumer caution due to high prices. The Bureau of Labor Statistics reported a 0.4% month-over-month increase in the consumer price index in October, slightly higher than forecast. Consumer spending drives the bulk of U.S. economic output, making these trends critical to overall stability.
Core retail spending, which excludes automobiles, gasoline, and restaurants, rose 0.3% month-over-month to $454.2 billion. That was a 3.4% increase from a year earlier. Core sales were up 5.63 percent for the first ten months of the year.
Selective sector performance amid economic pressures
Spending rose in nine of 11 sectors year-over-year. Performance varied sharply across categories.
| Category | Year-over-Year Change |
|---|---|
| Electronics & Appliances | +9.3% |
| Furniture & Home Furnishings | -2.6% |
| Sporting Goods, Music, & Bookstores | -0.4% |
Electronics and appliances led with a strong 9.3 percent annual gain. Furniture and home furnishings sales dropped 0.2% in October and fell 2.6% over 12 months. This decline is likely linked to rising mortgage rates freezing the housing market. Sales were higher year-over-year in all other categories. High gas prices also continued to affect consumer spending.
Businesses prepare to pass costs to consumers
Businesses are signaling further price pressures ahead. A National Federation of Independent Business survey found 37% of businesses plan to raise prices in the next three months. That is the highest level since July 2022.
Households are adapting to this environment. Matthew Shay noted, "Households are managing budgets carefully, timing purchases around special offers and sales events in order to stretch their dollars." Spending on leisure items like sporting goods pulled back by 0.4% year over year, despite a slight monthly uptick. Consumers continue to time their purchases around sales events to manage budgets amid sustained inflation.
