Retail Spending Rises 5.9% in July Ahead of Tariffs

Retail spending in the U.S. rebounded strongly in July 2025 as consumers took advantage of summer sales and accelerated purchases ahead of new tariffs imposed by President Donald Trump. According to data from the National Retail Federation's Retail Monitor, total retail sales excluding automobiles and gasoline rose 1.45% month-over-month and 5.89% year-over-year, reversing weaker sales in June. Core retail sales, excluding restaurants, automobiles, and gas, were up 1.55% month-over-month and nearly 6% year-over-year, with gains seen in eight out of nine retail categories including digital products, sporting goods, and general merchandise. Despite ongoing trade tensions and tariff increases reaching their highest levels in over a century, consumers continued spending as wages grew above inflation, though there are early signs of inflationary pressures on commodity goods. While President Trump's tariff policy is expected to cause some price increases, officials argue this will be a one-time adjustment rather than sustained inflation, encouraging shoppers to favor American-made products. The robust consumer spending suggests resilience in the economy amid trade policy changes, though upcoming inflation reports will provide further insight.