US Retail Sales Growth Slows in April Amid Rising Gas Prices

U.S. retail sales growth decelerated in April 2026, rising by only 0.5% compared to a revised 1.6% increase in March, according to Commerce Department data. This slowdown is primarily attributed to soaring gasoline prices, which have surged due to the ongoing Iran war and the subsequent shutdown of the Strait of Hormuz. With average gas prices reaching $4.53 per gallon, consumers have less disposable income for non-essential items. Consequently, sales at department stores fell 3.2%, and furniture stores saw a 2% decline. However, online retailers and electronics stores posted modest gains. The broader economic context includes significant inflationary pressure, with the producer price index jumping 1.4% and the consumer price index rising 3.8% year-over-year. Despite these challenges, the labor market remains resilient, with employers adding 115,000 jobs in the previous month. Economists note that while tax refunds initially boosted spending, high energy costs are now dominating household budgets. Further insights into consumer behavior are expected as major retailers like Walmart and Target release their quarterly financial results next week.