Retail spending surged in June, offering fresh evidence that American consumers remain a powerful engine for the economy even as interest rates remain elevated and inflation continues to ease.
The Commerce Department reported Thursday that retail sales rose 0.6 percent in June from the prior month, far surpassing economists’ expectations of just a 0.1 percent gain.
Sales excluding motor vehicles climbed 0.5 percent, while the so-called “control group” of retail sales—which strips out food services, autos, building materials, and gasoline—also rose 0.5 percent, pointing to robust underlying demand.
The report showed broad-based strength, with 10 of 13 major retail categories posting monthly gains. Spending at motor vehicle and parts dealers jumped 1.2 percent, reversing back-to-back declines. Clothing stores rose 0.9 percent, general merchandise stores climbed 0.5 percent, and restaurants and bars gained 0.6 percent, matching their May performance. Nonstore retailers, including e-commerce, posted a 0.4 percent gain.
The June gains were even more impressive given that May’s drop in retail sales—previously reported as -0.9 percent—was not revised, meaning the June rebound reflects genuine growth, not a data adjustment.
Year-over-year, total retail sales were up 3.9 percent, while the control group is tracking around 4.7 percent above June 2024 levels. Food services rose 6.6 percent from a year ago, and nonstore retail sales are up 4.5 percent.
The figures are not adjusted for inflation, but that context strengthens the signal. Vehicle prices fell, according to separate Labor Department data, fell for the month, making the 1.2 percent increase in sales even more remarkable. The rise in clothing sales more than doubled the price increase.
With the job market still tight and inflation showing no signs of tariff pressure, the report adds to growing evidence that the U.S. economy remains resilient heading into the second half of the year.
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