By Jeffry Bartash, MarketWatch
WASHINGTON (MarketWatch) — U.S. retail sales fell in May for the second month in a row — the first time that’s happened in two years — as consumers spent less to fill up their gas tanks.
Retail sales declined by 0.2% last month on a seasonally adjusted basis, the Commerce Department said Wednesday. And sales for April were revised lower to a a 0.2% drop from an original reading of a 0.1% gain.
It’s the first back-to-back decline since May and June 2010.
If gas purchases are omitted, however, retail spending actually rose a slight 0.1% last month, the government said. Sales at gas stations slumped 2.2% in May, the biggest drop since December. Separately, the Labor Department also reported a drop in gasoline prices that contributed to a big 1% drop in wholesale prices. Read story on wholesale prices.
Strong demand at auto dealers and Internet retailers boosted overall spending.
Auto sales rose 0.8% based on the government’s seasonally adjusted data. The increase was somewhat of a surprise since industry figures showed that total vehicle sales fell in May from April — to a 13.7 million annual rate from 14.4 million.
Excluding autos, retail sales fell 0.4%.
Economists surveyed by MarketWatch had expected sales to decline 0.3% in May, or by a smaller 0.1% excluding autos.
Aside from gas stations, sales also fell 1.7% at building materials and home-improvement stores and 0.5% at general-merchandise stores.
In a potentially worrisome sign, sales fell at virtually all the establishments that tend to rely on discretionary income — extra money consumers have left over after paying for bills and necessities.
Sales declined 0.2% at bars and restaurants, 0.1% at health-care stores and 0.1% at outlets that sell sporting goods and hobby items.
Sales also dropped 0.2% at liquor and grocery stores.
On the bright side, Internet and mail-order companies such as Amazon and Land’s End posted a sharp 1.3% increase in sales.
Sales also rose 0.9% at apparel stores as consumers bought new clothes for the summer while sales increased 0.8% at electronics and appliance stores.
Jeffry Bartash is a reporter for MarketWatch in Washington.
