Retail sales in the United States fell by 0.6% in July, according to the Department of Commerce. This was the first time sales dropped in almost nine months, and it is the biggest decrease since May 2025. Shops selling electronics, clothing, and home goods saw fewer people buying these items.

The main reason for the drop is that earlier in the year, many people had more money to spend after receiving tax refunds. Now, those refunds have finished, and families have less extra money to buy things they do not need.

Because of this fall in sales, some large banks and economists have changed their economic forecasts for the third quarter of 2026. They are now watching to see if this slowdown will continue in the coming months.