United States retail sales fell 0.9% in January, marking the largest decline in nearly two years according to the latest Census Bureau data, as consumers pulled back after a strong holiday shopping season.
The Commerce Department’s data on Friday showed a broad slowdown, with nine out of 13 retail categories posting declines, including autos, sporting goods, and furniture.
The slump coincided with severe winter storms and wildfires in Los Angeles, which may have dampened in-store shopping.
However, underlying economic pressures - including persistent inflation and high interest rates - suggest broader challenges.
Consumers have increasingly relied on credit cards and loans, with delinquency rates rising as borrowing costs remain elevated.
Meanwhile, U.S. industrial production unexpectedly slipped 0.1% in January, driven by a steep 5.2% drop in motor vehicle and parts output.
Aerospace production rebounded, offsetting some of the decline, but overall industrial activity remains fragile.
Trade policies have also added uncertainty. The Trump administration imposed a fresh 10% tariff on Chinese goods this month, while a 25% levy on Canadian and Mexican imports has been temporarily suspended until March.
In separate data, the Labor Department reported that U.S. import prices rose 0.3% in January, slightly below expectations, while export prices surged 1.3% - more than four times the forecasted increase. The sharp rise in export prices was driven by non-agricultural goods, including industrial supplies and capital goods.
