US shoppers sharply boosted spending at retailers in July despite higher prices

WASHINGTON (AP) — Americans stepped up their spending at retailers last month by the most in a year and a half, easing concerns that the economy might be weakening under the pressure of higher prices and elevated interest rates.

The Commerce Department reported Thursday that retail sales jumped 1% from June to July, the biggest such increase since January 2023, after having declined slightly the previous month. Auto dealers, electronics and appliance stores and grocery stores all reported strong sales gains.

The July retail sales data provided reassurance that the U.S. economy, while slowing under the pressure of high interest rates, remains resilient. It showed that America’s consumers, the primary driver of economic growth, are still willing to spend.

Adjusted for inflation, sales rose about 0.8% last month. And excluding gas station sales, which don’t reflect Americans’ appetite to spend, retail purchases also rose 1%.

Consumers have been pummeled since the pandemic by high prices and elevated interest rates. Yet at the same time, average wages have also been rising, providing many households with the means to keep spending.

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