Following a decline of 0.9 percent in May, sales rebounded 0.6 percent in June.
The Advance Retail Sales report for June shows a rebound in sales from a huge decline in May.
Advance estimates of U.S. retail and food services sales for June 2025, adjusted for seasonal variation and holiday and trading-day differences, but not for price changes, were $720.1 billion, up 0.6 percent (±0.5 percent) from the previous month, and up 3.9 percent (±0.5 percent) from June 2024.
Total sales for the April 2025 through June 2025 period were up 4.1 percent (±0.4 percent) from the same period a year ago.
The April 2025 to May 2025 percent change was unrevised from down 0.9 percent (±0.2 percent). Retail trade sales were up 0.6 percent (±0.5 percent) from May 2025, and up 3.5 percent (±0.5 percent) from last year. Nonstore retailers were up 4.5 percent (±1.4 percent) from last year, while food service and drinking places were up 6.6 percent (±1.8 percent) from June 2024.
The key phrase is in italics. These are nominal sales. It’s real (inflation-adjusted) sales that feed GDP.
Month-Over-Month Percent Changes
- Total: 0.6
- Excluding Motor Vehicles 0.5
- Excluding Motor Vehicles and Gas: 0.6
- Motor Vehicles: 1.2
- Food Service: 0.6
- Gas Stations: 0.0
- Nonstore: 0.4
- Food Stores: 0.5
Real Advance Retail Sales Percent Change
Inflation-Adjusted Retail Sales
- Total: 0.4
- Excluding Motor Vehicles 0.2
- Excluding Motor Vehicles and Gas: 0.3
- Motor Vehicles: 0.9
- Food Service: 0.3
- Gas Stations: -0.3
- Nonstore: 0.1
- Food Stores: 0.3
Those are strong numbers.
But do note that auto sales are counted when the manufacturer ships them to dealers, not when dealers sell them. And dealer inventories are rising.
Real vs Nominal Advance Retail Sales
Real vs Nominal Advance Retail Sales Detail
It’s easy to see that the “strong consumer” is little more than strong inflation.
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The producer price index was unchanged in June, in an interesting way.
July 15, 2025: Real Hourly Earnings of Private Workers Decline 0.1 Percent in June
Inflation-adjusted wages fell in June. A decline in hours worked makes it worse.
Real average weekly earnings decreased 0.4 percent in June due to the change in real average hourly earnings combined with a decrease of 0.3 percent in the average workweek.
Consumers spent anyway. Good luck with that.
My new plan is to get a new vehicle that is older than 2020, there are so many problems and so much tech to become outdated, disposable cars
“July 15, 2025: Year-Over-Year CPI Jumps 0.3 Percentage Points to 2.7 percent”
Not bad. I remember that the inflation target was typically small an positive, for example 2.0 percent. The highest inflation rate in recent history was 8.0% in 2022.
BBB: 100% bonus deduction (extra 100% deduction) on capex in 2025. 2022 (100%), 2023 (80%), 2024 (60%), 2025 and beyond extra 100% deduction to invest and hire employees.
Mish, please explain.
Mish, if u buy a $100,000 commercial truck are u getting a $100,000 bonus deduction in the first year, for a total of 200% deductions, or $200,000 deductions ?????
The word “bonus” is misleading; the technical name is additional first-year depreciation. You can’t deduct more than 100% of the cost. For qualifying property bought after January 19, 2025, you can deduct the entire cost in the year of purchase; if you do, you get no depreciation after 2025. For 2024, you could deduct 60% of the cost in the year of purchase and depreciate the remaining 40% of the cost over 6 years.
The supply side gets a write-off in a bad economy in the hope they buy capital goods so the top 10% buy more goods and services in a nation that foreigners are diminishing their investments in the US, rising interest rates in the long end of the bond markets will continue, a new Trump sychophant as Fed chair that will create a Gilt crises but for the dollar, reduced cash flows for investments of capital goods that bought loans benchmarked against the 10-year treasury.
This ain’t Ronnie Raygun’s economy of trickle down economics when there was still a working and middle classes that the supply side could cannibalize.
China: instead of giving $30,000 to Shingle mums the Chinese gov gives it to small businesses to invest and hire workers. It’s better than digging holes in the ground during the 30’s in the US.
The PRC is still a developing country.
Another canard about Great Depression. Review GNP from ‘33 till Q3 ‘41
2024 campaign: “Kamala Harris to propose up to $50,000 tax deduction for new small businesses” – where were you going with this idea, I’m curious now.
@Mish can you point to the methodology for registering car sales when they go to the dealers lot? I’ve heard you highlight this before, but I can’t find it
That’s what Lee Iacocca discovered when he first went to Chrysler. Corporate was ordering the manufacturing of as many cars as possible, no matter the actual demand, because that is what they were bonused on, whether when or were actually sold to real customers.
The safe parking lot near me has thousands of unsold brand new cars and pickup trucks. Non of them are registered. That’s about $80/$100 millions cost center doing nothing all day (2K cars x $40K$50K each). I wonder if incentives will be larger than Tariffs. Besides we are beyond peak selling season and 2026 models are coming soon.
As Mish highlights, cars are only registered as sold when they go to the dealership in those long trucks that lug them around; but they have to be sold before they really enter the economy.
That means that some of the data is fudged a little, providing a false perspective on events. In addition, inflation can be both overt and secret, with a supply chain that is longer having more room for hidden inflation to miss being counted.
I believe we are clearly entering a recessionary environment that should be sprung on us before 2027 at the latest. I wouldn’t be surprised if, despite the low price of energy and the glut of oil, a recession hit in mid-2026. Then we’ll see the sales of all items across the board crater.
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Dark . Sport. Blog is my website — come there for more insight by me
Cars in dealers parking lots aren’t registered. Only the buyers can register cars/trucks.
CPI is bovine excrement so real sales are also a lie.
Real GDP per ATL FED is tracking at 2.4% for Q2 assuming the deflator is accurate, which it isn’t.
“All governments lie.”
I. F. Stone
“Recession” Lol! The word is just hilarious at this point, and definitely now that the Big Boondoggle Bill has been signed into law.
The car sales are likely due to the 100% bonus depreciation in that bill.
The new ability to deduct interest paid on car loans (up to $10,000 annually) is likely another factor.
No matter how hard the economy tries to go into recession it cannot as long as the Federal government is borrowing $3000 per year for every man, woman, and child in the US. Six or seven % of GDP on the credit card every year. The only question is how long this can go on? In the current positive loop, most of the dollars lent to out of towners are recycled back into town. Keep it up! Until the out of towners find that our real estate, stocks, bonds, farms, national parks and what have you are no longer trendy. Sad day for our town. Will it ever happen?
It can go on much longer than you can remain solvent.
The reason is that other deadbeat countries are working by the same script, only they don’t have manufacturing capacity, much less IP.
That explains the continued foreign demand for treasuries, which again explains why financially illiterate people’s deputies vote for ever more debt.
It’s for the children.
At some point that $3000 is just to maintain the status quo. If you want to avoid a recession forever or at least until the debt reckoning then $3000 has to become $4000 then $5000 and so on.
If only there was a currency humans could Buy thaT was not Created to lose all its purchasing power over time
Tell me if I’m reading this correctly but it looks like this amazingly great data is actually just suggesting dealers buying a ton of cars in preparation for potential auto tariffs. The rest is improved but still hanging around the baseline.
Call some dealers to find out.
Call some? Are you a sociologist now? There are thousands of car dealers and dealerships to service 340 million people living across the US. When did a few anecdotal phone calls (whose survey outcomes will depend primarily on how the questions are asked and perceived) become evidence of anything worth discussing on a macroeconomics blog?
Doug ain’t the brightest bulb but lucky for him: I’m fortunate enough to actually have inside info from a major auto manufacturer here. As you can guess, they’re worried and stocking up on parts. Unfortunately most of the frames are Mexican made, so prices are already increasing in cars manufactured in the last few months.
I assume this is why dealers are trying to hoard cars now since the prices of new inventory will only rise from here on out. Some foot dragging was done on this because people were betting on TACO, but that’s backfiring already. Tariffs on steel, copper, and aluminum will crank the price of every new car by at least ten grand maybe more.
Dealers already have a ton of overpriced junk sitting on their lots from the pandemic, but the prospect of having to go who knows how long without new inventory at a reasonable price is probably driving panic purchasing. I know more than a few folks who’ve started making bulk orders for common parts with the intent of making huge profits in their garages when tariffs force everyone to repair instead of replacing.
I see these attempts to capitalize on tariffs contributing greatly to making the recession increasingly ugly as people tear each other apart to survive.
I run into many car brand / model aficionados who claim that a specific car was better x years ago (mostly 10 or more years ago), than now. Absolutely nothing to do with tariffs. Unless Trump invented the CVT(?)
A $10,000 price increase has nothing to do with tariffs that directly increase the price of pretty much everything going into the car? Another question, do any of these brand/model aficionados actually work in the industry?
Good that you actually talked to people who are dealers so you have insight to their thinking. That’s what a good analyst does. Now give us insight as to how much more cars will cost. I may not be the brightest bulb but it is easy to outshine many here.
Thanks, Doug, for bringing us some new-age economic analysis.
Now can you provide us with some actual examples of your own conversations with any of the thousands of foreign producers that are supposedly on the front end of US tariffs? How much did they reduce their price specifically due to US import tariffs? What are their product names?
I’m sure these analytics of yours would be very beneficial to those of us trying to understand the impacts of US import tariffs. Thanks in advance
I already did in previous comments. You don’t have to talk to every one because most everyone within a specific industry is faces with the same problem and come up with similar solutions. I will give you an example. L’Oreal is not much affected because years ago they shifted much production to the US for the US market. Since they sell $11 billion there every year it was worthwhile for them not to be subject to currency changes. On the other hand a much smaller company that exports garden furniture to the US had to eat part of the tariffs and is switching some production to the US. A company like ASML has a different problem with the tariffs. If you want a discussion of the different sectors then why not introduce one if future comments and get everyone talking and analyzing instead of insulting each other?
Good insights, thanks. I’m always open to the US kicking the can down the road, with debt, with GDP growth (recession medicine), etc. So that’s the only part where I’m a little skeptical, until we actually see a recession, we’ve planned them out through reckless policy for years now.
Amateur
Car dealers are the most honest folks on the planet LOL