US retail sales unexpectedly fell in May as auto purchases slumped amid a massive supply shortage, while record high gasoline prices drove spending away from other goods.
The first drop in retail sales in 5 months, announced by the US Department of Commerce on Wednesday, also indicates that High inflation is starting to hurt demand. It came on the heels of major retailers such as Walmart and Target cutting their profit forecasts due to cost pressures.
The ministry’s report said that retail sales fell 0.3% last month, and the ministry revised the numbers for April down to show that sales rose 0.7% instead of 0.9% in the previous reading.
Economists polled by Archyde.com had expected retail sales to rise 0.2%, and on an annual basis, sales jumped 8.1% in May.
