On February 12, 2025, produce in HEB grocery store at a customer store in HEB grocery store in Austin, Texas.
Brandon Bell | Getty Images
Consumers cut spending sharply in January, indicating a potential weakening of economic growth, according to a Commerce Department report Friday.
retail The month’s 0.9% declined from a 0.7% increase in December, even worse than the Dow Jones estimates that it fell by 0.2%. Total sales were seasonally adjusted, but prices rose 0.5% in a month.
Excluding cars, prices fell by 0.4%, and far exceeded consensus forecasts, up by 0.3%. A “control” measure that directly splits several non-essential categories and numbers into GDP fell 0.8%, and has since grown 0.8%.
As consumer spending accounts for about two-thirds of all economic activity in the U.S., sales figures indicate a potential weakening of growth in the first quarter.
Receipts for sports goods, music and bookstores fell 4.6% in the month, while online stores reported a 1.9% decline, and auto and parts spending fell 2.8%. Gas stations, as well as food and drinking venues, all reported an increase of 0.9%.
