Retail sales for July were flat, compared with the estimate for a 0.1% gain.
Excluding autos, sales increased 0.4% against expectations for no gain.
Falling fuel prices held back receipts at gas stations, while consumers took those savings and spent at other retailers.
According to a study released on Wednesday by the Census Bureau, retail activity was unchanged in July as lowering gas prices restrained gas station sales and customers increasingly turned to online shopping.
Advance retail sales remained flat, but overall receipts excluding vehicles increased by 0.4%. The top-line figure and a flat total ex-autos were what economists polled by Dow Jones had expected. The increase for June was reduced from 1% to 0.8%.
Sales of food and merchandise, excluding those for cars and fuels, increased by 0.7% from one month prior.
The figures, which are seasonally adjusted but not for inflation, were released in a month in which the consumer price index similarly registered no change.
Gas station receipts decreased 1.8% as a result of a drop in fuel prices from their record nominal highs, which impacted sales at the pump. Sales at dealers for vehicles and parts dropped considerably as well, down 1.6%.
According to AAA, regular unleaded gas recently cost $3.94 per gallon. Earlier in the summer, gas prices had above $5 per gallon in several places.
According to Ian Shepherdson, chief economist at Pantheon Macroeconomics, “people appear to have leveraged some of the savings from lower petrol costs to spend more on other products, both in nominal and – very possibly — real terms. The chip scarcity has significantly restricted auto sales, therefore there is probably a lot of pent-up demand. Department stores and clothing retailers were the other July losers, but all of these factors are noisy and liable to change.
These declines in petrol and car sales were countered by gains in other stores of 1.5% and 2.7% online.
Consumers have been struggling to keep up with rising prices that have increased 8.5% overall from a year ago, which is close to the highest level in forty years. Even with the drop in energy prices in July, gas station receipts increased by 39.9% from a year earlier. Price increases have been particularly harmful in the food and energy categories.
The pressures of inflation subsided somewhat in July, and consumers were able to spend money elsewhere thanks in part to the drop in fuel prices.
However, despite the food price index, as reported by the Bureau of Labor Statistics, rising 1.1% for the month, food sales only grew by 0.2%. With a 0.1% increase, sales at pubs and restaurants also had difficulty.
Several retailers have had difficulties in the present market.
Target reported on Wednesday that it had to mark down the pricing of unsold goods, which caused its profitability to decline by about 90% from a year earlier.
In order to restrain inflation, the Federal Reserve has raised interest rates. The central bank raised interest rates by 0.75 percentage points back-to-back in June and July, and it is anticipated that it will continue doing so until inflation falls to the Fed’s 2% target.
