Retail Sales Stall in December as Consumers Seen Pulling Back on Spending

11:21 AM EST, 02/10/2026 (MT Newswires) -- US retail sales unexpectedly held steady in December, the Census Bureau said Tuesday, as consumers appeared to pull back on spending at the end of 2025 after kicking the holiday season off at a strong pace.

A flat reading compares with the Bloomberg-compiled consensus that called for a 0.4% rise. The pace of increase in November was left unrevised at 0.6%, the Census Bureau said.

The print is "an unwelcome stumble for consumers that started the holiday season at a solid pace," BMO Chief US Economist Scott Anderson said in a note.

Control group sales, excluding autos, gasoline, building materials and food service, slipped 0.1% from November, Anderson said. That metric is used to help estimate real consumer spending growth in the gross domestic product report.

"Slower real disposable personal income growth, a softening labor market, and declining saving rates finally appear to have diminished the US consumers' willingness and ability to spend, at least temporarily," Anderson said.

Jefferies said the weakness in December may be driven by consumers bringing their purchases forward.

"These numbers stand in contrast to anecdotal reports that described a strong holiday shopping season, but the weakness in December specifically may be a product of a recent trend where consumers are shifting the timing of their holiday shopping earlier and earlier each year," Jefferies Chief US Economist Thomas Simons said in a note e-mailed to MT Newswires.

On an annual basis, retail sales grew 2.4% in December, marking a deceleration from a 3.3% jump the previous month. Retail sales in the fourth quarter of 2025 rose 3% year over year and 0.4% sequentially.

The data reflect the "ripple effects" of the longest US federal government shutdown that occurred from October to November last year and delayed economic reports, Simons said.

Spending at motor vehicle and parts dealers fell 0.2% month on month in December following a 1.2% increase the month prior. Growth in sales at gasoline stations eased to 0.3% from 1.7%. Spending at furniture stores dropped, with sales turning negative at clothing and electronics stores.

"Looking ahead, we are not optimistic about a near-term bounce to the pace of spending we saw in (the third quarter)," Simons said. "Neither January nor February contain any annual shopping seasons, and they are often negatively impacted by weather."

"Spending will probably improve once tax refunds start to hit consumers' bank accounts, but that is unlikely to drive significantly higher spending until March," Simons said.

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