U.S. Retail Sales Extend Growth Streak in May Despite Inflation Pressures
U.S. retail sales continued their upward trajectory in May, marking the eighth consecutive month of growth as consumers maintained spending on essential goods despite ongoing inflationary pressures and elevated fuel costs.
According to the latest CNBC/NRF Retail Monitor, core retail sales, which exclude restaurants, automobile dealers, and gas stations, increased by 0.39% month over month in May and rose 6.98% compared to the same period last year. The figures follow gains of 0.34% month over month and 5.53% year over year recorded in April.
For the first five months of 2026, core retail sales have increased by 6.19%, reflecting continued resilience in consumer spending despite economic headwinds.
Unlike traditional retail sales reports published by the U.S. Census Bureau, which are based on survey data, the CNBC/NRF Retail Monitor uses anonymized credit and debit card transaction data compiled by Affinity Solutions, providing a more direct measure of consumer purchasing activity.
Consumers Prioritize Essential Spending
Industry observers noted that shoppers are becoming increasingly selective in their spending habits as the impact of larger tax refunds received earlier in the year begins to fade.
“Consumers are prioritizing essentials and finding creative ways to stretch their household budgets,” said Matthew Shay, President and CEO of the National Retail Federation (NRF). He added that retailers are working closely with suppliers and supply chain partners to help keep prices affordable for shoppers.
Furniture and Home Furnishings See Slower Growth
While most retail sectors posted positive results, furniture and home furnishings stores experienced a softer performance. Sales in the category declined 0.09% month over month on a seasonally adjusted basis but remained 3.35% higher than a year earlier.
The results suggest consumers are focusing spending on necessities and discretionary categories with immediate demand rather than larger home-related purchases.
Apparel and Electronics Lead Gains
Several retail categories delivered strong year-over-year growth during the month.
Clothing and accessories stores recorded a 0.6% monthly increase and a 10.25% annual gain, while electronics and appliance retailers posted growth of 0.05% month over month and 11.59% year over year.
Health and personal care stores rose 0.45% from April and 8.87% from a year earlier. Sporting goods, hobby, music, and book retailers increased 0.25% monthly and 8.59% annually.
General merchandise stores also maintained momentum, with sales up 0.41% month over month and 8.28% year over year.
Digital products, including electronic books and gaming content, recorded one of the strongest monthly performances, rising 1.22% compared with April and 7.79% from the previous year.
Grocery Sales Remain Strong
Grocery and beverage stores continued to benefit from steady consumer demand, posting a 0.48% monthly increase and a 6.01% annual gain.
Meanwhile, building and garden supply stores were among the weakest-performing categories, with sales declining 0.38% month over month and 1.88% year over year.
Retail Sector Shows Resilience
The latest figures indicate that despite concerns surrounding inflation and fuel prices, consumers continue to support retail activity. However, spending patterns are increasingly concentrated on essential goods and value-focused purchases, creating varying performance levels across retail categories.
With most major retail segments recording positive annual growth, the sector remains resilient, although retailers continue to navigate a cautious consumer environment marked by budget-conscious purchasing decisions.
