US Retail Sales Growth Expected to Slow as Inflation Strains Consumers
American consumer spending is losing momentum as persistent inflation and labor market anxieties tighten household budgets. The Census Bureau's delayed September retail sales report, due this week, is projected to show a 0.4% increase—down from August's 0.6% gain—signaling the first cracks in what had been resilient summer demand.
Everyday essentials now consume a historic share of income, leaving little room for discretionary purchases. Groceries, housing, and utilities alone have created what University of Michigan researchers call a "budget vise," with consumer sentiment turning increasingly pessimistic despite moderating price spikes.
The slowdown may foreshadow broader economic headwinds. Third-quarter growth benefited from robust spending, but economists warn this tailwind is fading as financial pressures mount. When wallets tighten, non-essential purchases—including speculative assets—often face the sharpest cuts.
