Retail sales fell more than expected in January, biggest drop in eight months
People walk along Broadway with shopping bags on February 27
By Bryan Mena, CNN
Washington (CNN) — Spending at US retailers unexpectedly fell in January as consumer confidence languished and harsh cold weather buffeted various parts of the country.
Retail sales declined 0.2% in January from the prior month, the Commerce Department said Friday, the biggest decline since May. January’s reading came in below expectations of 0%, according to a poll of economists by data firm FactSet. The figures are adjusted for seasonal swings but not inflation. The report was delayed a few weeks because of last year’s government shutdown.
A persistent streak of weak or declining spending would spell trouble for the US economy, since people’s purchases making up about two-thirds of economic growth. However, economists widely expect bigger tax returns this year to perk up spending in the first half of 2026.
Retail sales declined across most categories in January, falling the most at department stores (-6%), personal care shops (-3%) and gasoline stations (-2.9%).
A measure that strips out volatile sales — such as building materials and gasoline — and gives a better indication of underlying demand advanced 0.35% in January, roughly in line with economists’ estimates. It’s a key figure economists refer to as the “retail sales control group.”
This story is developing and will be updated.
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