Retail Sales Research Brief

Consumer resiliency being tested. Greater spending in March translated into record sales tallies in six of 10 core retail categories, reflecting households’ continued prioritization of necessities, discounted items and experiences. Still, the pace of sales growth has been decelerating, as spending and consumer sentiment are being impacted by persistent inflation, economic uncertainty and significant shifts in U.S. trade policy. During the first three months of 2025, core retail sales rose 0.6 percent on a quarterly basis, but when factoring in core CPI inflation, spending in real terms dipped slightly — by 0.1 percent. As the U.S. economy faces potential risks of simultaneously higher inflation and slower growth, a more cautious consumer is likely to materialize. Fortunately, the retail sector is well positioned to handle possible spending-related headwinds, as vacancy was historically low entering April.