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Retail sales fall 0.3% in May on rising inflation

NEW YORK – Americans unexpectedly cut spending in May from a month earlier, underscoring how rising inflation in essentials like gasoline is prompting them to be more cautious about their purchases of non-durable items.

US retail sales fell 0.3% last month, compared with a revised 0.7% increase in April, according to a government report released on Wednesday.

Furniture and home furnishings store sales fell 0.9%, while grocery store sales rose 1.2%. Business in restaurants increased by 0.7%.

Adjusted for inflation, which rose 1% from April to May, retail sales fell even further.

The report offers discouraging news about the economy as consumers continued to provide crucial support to the economy after a year in which prices for gas, groceries, rent and other necessities soared. But signs of recession risks are mounting. Inflation is at a 40-year high. Stock prices go down. The economy actually contracted in the first three months of this year. And the Federal Reserve makes borrowing much more expensive.

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One of the biggest concerns is rising inflation, which is more widespread and persistent than expected. Consumer prices rose 8.6% year over year last month, the largest annual 12-month jump since 1981. The rise was fueled by much higher prices for everything from airline tickets to restaurant meals to new and used cars.

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AP economics writer Chris Rugaber in Washington contributed to this report.

Copyright 2022 The Associated Press. All rights reserved. This material may not be published, broadcast, transcribed or redistributed without permission.

https://www.local10.com/business/2022/06/15/retail-sales-in-may-fall-03-amid-surging-inflation/ Retail sales fall 0.3% in May on rising inflation

Sarah Y. Kim

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