US retail sales beat forecasts in May

U.S. retail sales rose 0.9% in May 2026, accelerating from a revised 0.4% increase in April, based on Commerce Department Census Bureau figures released Wednesday. The May advance exceeded the 0.5% gain economists had forecast, pointing to firmer-than-expected consumer spending at the start of late spring.

The improvement was broad-based across major retail categories. Overall, the data show continued growth in nominal spending, even as some temporary supports begin to diminish. Economists noted that the stronger May result followed a softer, revised April performance.

Retail sales excluding automobiles, gasoline, building materials and food services, a core measure closely watched for underlying demand, increased 0.7% in May after a 0.5% rise in April. This measure strips out some volatile components to give a clearer view of consumer outlays.

Separately, retail sales excluding gas stations also rose 0.7% in May. This suggests consumer demand remained solid even when the direct effect of gasoline receipts is removed, indicating that higher spending was not confined to fuel-related purchases.

Several key retail categories posted notable gains in May. Online and nonstore retailers saw sales climb 1.5%, marking one of the strongest advances among major segments. Home furnishing and furniture stores recorded a 1.0% increase in sales over the month.

Clothing and accessories stores also contributed to the overall rise, with sales up 0.3% in May. These increases indicate that discretionary categories, including home-related goods and apparel, participated in the broader advance in consumer spending.

Some of May’s increase in total retail sales reflected higher gasoline prices that earlier had lifted receipts at service stations. Gasoline prices had surged to a four-year high amid the U.S.-Israeli war with Iran before subsequently retreating. By this week, the national retail average for gasoline had slipped back below $4 per gallon for the first time since April.

Generous government tax refunds in April and May also supported consumer spending, providing extra cash that flowed into retail purchases. Economists, however, indicated that this tax-refund cushion is starting to fade, suggesting that this particular boost to sales may be temporary.