May retail sales slow to 0.1% increase, below expectations

June 18 (UPI) -- May's retail spending figures came under Wall Street predictions, with gas prices and restaurant dining softening around the country, according to the latest statistics released by the Commerce Department on Tuesday.

According to the Advance Monthly survey, retail and food service sales increased a seasonally adjusted 0.1% in May. Dow Jones economists had predicted sales would jump 0.2%. The $703.1 billion is 2.3% higher than what it was in 2023, just above the Federal Reserve benchmark of 2.0%.

Gasoline sales led the way in moderating sales, dropping 2.2% in May from April. That appeared to be offset by sales at online outlets, up 0.8%, and sporting goods, music, and bookstores, which jumped 2.8%. Restaurant and drinking establishment sales tumbled 0.4% in May.

"Total sales for March 2024 through May 2024 period were up 2.9% from the same period a year ago," the Commerce Department said. "Retail trade sales were up 0.2% from April and up 2.0% above last year."

Sales for motor vehicles and parts dealers increased 0.8% while building materials and garden equipment sales dropped by the same amount from April to May.

The slower-than-expected sales ahead of the summer season will be closely watched by the Fed as they try to determine if the economy is slowing enough to cut interest rates or to stand pat where way it has all year.