Retail Sales Drop Worse-than-expected 1.1% In July

Shoppers in the U.S. cut back their purchases in July even more than expected as worries over Covid-19 restrictions may dampened activity and government stimulus dried up.

Retail sales for the month fell 1.1%, worse than the Dow Jones estimate of a 0.3% decline and below the upwardly revised 0.7% increase in June. Excluding automobiles, sales declined 0.4%, according to Commerce Department figures released Tuesday. Markets showed little initial reaction to the news, with futures tied to the Dow Jones Industrial Average off more than 200 points and government bond yields lower across the board. Consumers make up nearly 70% of all activity in the U.S., so retail sales are watched closely as a gauge to overall economic health.