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The numbers: Sales at retailers such as auto dealers, restaurants and Internet sites rose again in June after a mammoth gain in May, underscoring the strength of the U.S. economy as spring turned to summer.
Sales at retailers nationwide grew 0.5% last month, the government said Monday. That matched the MarketWatch forecast of economists.
The increase last month followed an even bigger burst of spending in May, when sales grew a revised 1.3% instead of previously reported 0.8%.
Retail sales have increased 6.6% over the past 12 months, slightly above the long-run average since 1980.
What happened: Retail sales have accelerated in no small part because of higher gas prices. Gas stations posted a 1% increase last month and sales are up a whopping 21.6% in the past year.
It’s not just all gasoline or rising inflation, however. Americans raised spending in the spring on a variety of goods and services, spurring businesses to increase hiring and production.
Sales at health and personal care stores leaped 2.2% in June. Restaurants posted a 1.5% gain. Internet sales jumped 1.3%. And auto dealers reported a 0.9% increase.
Sales fell slightly at groceries and electronic stores. They declined sharply at department stores and outlets that sell clothing, books and sporting goods.
Big picture: The Trump tax cuts, strong hiring and a falling unemployment rate have given Americans more confidence in the economy. That’s led to a big rebound in spring after a winter lull, heralding a robust increase in gross domestic product in the second quarter.
Yet the strong patch of growth has also raised worries about inflation and the prospect that the Federal Reserve could rapidly raise interest rates.
Worsening trade tensions between the U.S. and key trading partners such as China and Europe are also casting a pall over the economy’s prospects.
Market reaction: The Dow Jones Industrial Average DJIA, +0.38% and the S&P 500 SPX, +0.11% were set to open flat to higher in Monday trades.
The stock market has rebounded in the past week after a big dip following the latest tit-for-tat tariffs between the U.S. and key trading partners. Yet the stock market is still down from record highs set earlier in the year amid ongoing trade tensions.
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The 10-year Treasury yield TMUBMUSD10Y, +0.48% was little changed at 2.86%. The yield has fallen from a recent high of 3.1% owing to in part to worries about growing trade tensions.