The Retail Monitor’s calculation of core retail sales, which excludes restaurants, automobile dealers, and gasoline stations, showed a 0.22 per cent decrease month-over-month (MoM) in February. However, year-over-year (YoY) figures reflected a 4.11 per cent increase. This compares to January’s 1.27 per cent monthly decline and a 5.72 per cent rise from the previous year.
Retail spending fell 0.22 per cent in February due to tariff concerns but grew 4.11 per cent YoY, indicating economic resilience.
President Trump’s tariff hikes impacted consumer sentiment, causing the index to drop to 64.7.
Online sales surged 36.51 per cent YoY, while general merchandise grew 6.2 per cent.
NRF’s CEO cited inflation fears and policy uncertainty as key factors.
For the first two months of 2025, total retail sales climbed 4.41 per cent YoY, while core retail sales saw an even higher increase of 4.91 per cent. These figures outpace the 3.6 per cent growth recorded for the entirety of 2024, signalling continued consumer demand despite macroeconomic pressures.
The February downturn came in the wake of tariff announcements by US President Donald Trump. At the beginning of February, Trump introduced a 10 per cent tariff on goods imported from China and a 25 per cent tariff on goods from Canada and Mexico. While the Canada-Mexico tariffs were initially delayed by a month and later postponed for most goods until April 2, tariffs on Chinese imports were doubled to 20 per cent. The tariff announcements appear to have contributed to a decline in consumer confidence. The University of Michigan’s Index of Consumer Sentiment dropped from 71.7 in January to 64.7 in February, marking the second consecutive month of decline after five months of moderate increases.
Retail performance varied across key sectors. Online and non-store sales rose 0.46 per cent MoM, with a significant 36.51 per cent increase YoY. General merchandise stores saw a 0.42 per cent monthly decline but recorded a 6.2 per cent annual growth. Clothing and accessories stores fell 0.78 per cent MoM but gained 3.75 per cent compared to February 2024. Furniture and home furnishings stores declined in both categories, with a 1.01 per cent monthly drop and a 3.67 per cent decrease YoY.
“Consumer spending dipped slightly again in February due to the combination of harsh winter weather and declining consumer confidence driven by tariffs, concerns about rising unemployment and policy uncertainty. Unease about the probability of inflation and paying higher prices for non-discretionary goods has the value-conscious consumer spending less and saving more. But for the moment, YoY gains reflect an economy with strong fundamentals,” NRF president and CEO Matthew Shay said in a release.
Fibre2Fashion News Desk (HU)
