Retail Sales Fall Unexpectedly in July

New York, NY, Aug. 13, 2009–Retail sales fell in July after two straight months of gains, the Commerce Department reported.

The drop surprised economists.

The Commerce Department said total retail sales declined 0.1% last month, compared with June’s revised gain of 0.8%. Total sales were originally reported to have increased 0.6%.

Economists had been expecting June sales to increase 0.7%.

The worse-than-expected monthly report followed a worrisome quarterly report from Wal-Mart Thursday in which the world’s largest retailer said it logged an unexpected 1.2% drop in its second-quarter same-store sales.

Sales excluding autos and auto parts also registered an unexpected decline of 0.6% compared to a revised 0.5% increase in the measure in June. Sales, excluding autos, were originally reported to have increased 0.3% in the prior month.

Economists had forecast a gain of 0.1% in July sales, excluding auto purchases.

Excluding a 2.4% gain in automobile sales and a 0.6% gain in clothing purchases in the month, most other retail categories suffered sales declines.

The government report showed building materials sales fell 2.1%, electronics purchases fell 1.4%, department store sales slumped 1.6% and sales at general merchandise stores declined 0.8%.

Elsewhere, furniture sales fell 0.9% and sales at food and beverage sellers declined 0.3% in the month.