U.S. retail sales rose 0.5% in July, consumer spending resilience may influence Fed's decision

[Coin World] On August 15th (UTC+8), U.S. consumer spending rose in July, meeting economists' expectations, indicating that American households remain resilient despite the uncertain economic outlook. Data shows that retail sales in July increased by 0.5% compared to June, and rose by 3.9% year-on-year. Wall Street is hopeful for interest rate cuts this fall, with Fed Chair Powell stating in July that consumer spending is one of the data points the Fed "follows most closely" when setting interest rates.

Driven by a strong labor market and income growth, consumer spending has shown remarkable resilience over the past five years, but recent signs indicate that consumers are tightening their belts to cope with tariff uncertainties and immigration policies. Despite a strong retail sales report in June, the data for May and April was lackluster, prompting Powell to state at last month’s FOMC meeting that spending is "undoubtedly" slowing. This decline may not be immediately evident in the July report, as summer holidays and Amazon's Prime Day may have boosted consumption.