WASHINGTON — Retail sales delivered their weakest performance in five months in July as shoppers shunned autos while they paid more for gas.
With the mass mailings of tax-rebate checks now just a memory, there is concern that the fragile economy could slow even more in the second half of this year.
The Commerce Department reported Wednesday that retail sales fell 0.1 percent last month, the first decline since a 0.5 percent tumble in February. It was a worse showing than the flat reading economists had been expecting and followed a revised, but still weak, 0.3 percent reading for June.
Analysts said retail sales would have been more feeble without the $92 billion in rebate payments the government sent out in May, June and July.
Those checks helped counter plunging home prices, rising unemployment and soaring gasoline prices.
The bulk mailings are now over, though, leaving economists worried about what will happen next to spending.
“Cautious and uncertain consumers are watching their wallets, and with the back-to-school shopping season underway, that does not bode well for retailers,” said Joel Naroff, chief economist at Naroff Economic Advisors.
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