Purchases sink 0.5% in June as the nation’s economy slows By Jeffry Bartash, MarketWatch WASHINGTON (MarketWatch) — U.S. retail sales fell in June for the third straight month as consumers cut spending on most goods and services, signaling much softer economic growth in the second quarter. Retail sales slumped a seasonally adjusted 0.5% in June following declines in May and April, the Commerce Department reported Monday. The last time the U.S. experienced three straight monthly declines in retail spending was in the second half of 2008, midway through the Great Recession. The weak retail report fell well short of Wall Street expectations. Economists surveyed by MarketWatch had forecast a 0.2% increase in sales. Without stronger retail sales, the U.S. economy cannot expand faster. Retail spending accounts for more than two-thirds of the nation’s economic growth. In somewhat of a surprise, auto sales were reported to have declined 0.6% even though industry figures showed that purchases increased in June after falling in May. Excluding autos, retail sales fell 0.4%. Economists were expecting no change in that category. The biggest decline occurred at gas stations, which is a good thing for consumers. Sales fell 1.8%. Yet spending also fell sharply at stores that sell building materials, sporting goods and leisurely items, home furnishings, electronics, appliances and personal-care items. The only retailers to report an increase in sales were clothing outlets, groceries, liquor stores and Internet sites such as Amazon. In the past 12 months, U.S. retail sales have risen 3.5%, but they fell in the second quarter. Sales in May were unchanged at a 0.2% decline, while sales in April were revised down to a 0.5% drop from a 0.2% drop. Jeffry Bartash is a reporter for MarketWatch in Washington.

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