WASHINGTON, Aug. 15 (Xinhua) -- U.S. retail sales fell in July, pointing to softer consumer spending amid persistent price pressures and signs of a cooling labor market, according to data released Friday by the U.S. Commerce Department.
Retail sales declined 0.6 percent in July from a revised 0.2-percent increase in June, marking the biggest downtick since May last year. The decline came after stronger spending in April and May, when tax refunds helped support household consumption.
The latest figures fell short of analysts' expectations for a modest increase and prompted concerns among some economists about the underlying strength of consumer demand.
"The biggest fall was with autos, but pulling out autos and gas sales, nominal sales were still down 0.2 percent for the second consecutive month," Dean Baker, a macroeconomist and co-founder of the Center for Economic and Policy Research, told Xinhua. "And this is even with the boost to restaurant sales from the World Cup."
"That looks (like) some real weakness to me. In a context where job growth has slowed to a crawl and wages have not kept pace with inflation, this should not be surprising," Baker said.
Gasoline prices have also remained elevated compared with a year earlier. The average U.S. retail price for regular gasoline stood at 4.077 U.S. dollars per gallon on Friday, nearly 1 dollar higher than a year earlier, according to the American Automobile Association.
At the same time, consumer sentiment dropped 8 percent from the month prior, according to last week's report from the University of Michigan.
Consumer spending is a key component of the U.S. economy, and economists said a sustained slowdown in household purchases could weigh on overall economic activity.
"Retail sales are a big part of the economy. If consumers slow their purchases, it harms the overall economy," Darrell West, a senior fellow at the Brookings Institution, told Xinhua. "People have difficulty buying things when the cost of living keeps rising."
Christopher Galdieri, a political science professor at Saint Anselm College in the northeastern state of New Hampshire, said the retail sales report is "particularly notable."
It shows that Americans are "adjusting their purchasing to account for higher prices or in the anticipation of further bad news," Galdieri told Xinhua.■
