Retail sales fell in May, dragged down by a decline in auto sales and a shift by Americans to spend more on vacations and other services instead of goods.
Total sales dropped a seasonal adjusted 1.3% in May from the month before, the U.S. Commerce Department said Tuesday. Wall Street analysts expected a smaller decline of 0.5%.
Economists expected retail sales to drop last month because of the lack of cars available for sale due to a worldwide shortage of chips, which are needed to power in-car screens and other features. Sales at auto dealerships fell 3.7% last month, according to the Commerce Department.
Another reason for the decrease: As more people become vaccinated and head out more, Americans are spending more of their money on haircuts, trips and other services that are not included in Tuesday's report. Sales fell at furniture, electronics and home building stores last month.
“Consumer spending growth through the rest of the year will shift to services from goods,” wrote PNC chief economist Gus Faucher.
Sales at restaurants rose nearly 2%, according to Tuesday's report. And those seeking a new outfit to go out in helped sales at clothing stores rise 3%.
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Nestlé has dismissed its CEO Laurent Freixe after an investigation into an undisclosed relationship with a direct subordinate. The company announced on Monday that the dismissal was effective immediately. An investigation found that Freixe violated Nestlé’s code of conduct. He had been CEO for a year. Philipp Navratil, a longtime Nestlé executive, will replace him. Chairman Paul Bulcke stated that the decision was necessary to uphold the company’s values and governance. Navratil began his career with Nestlé in 2001 and has held various roles, including CEO of Nestlé's Nespresso division since 2024.
Kraft Heinz is splitting into two companies a decade after they joined in a massive merger that created one of the biggest food companies on the planet. One of the companies will include brands such as Heinz, Philadelphia cream cheese and Kraft Mac & Cheese. The other will include brands like Oscar Mayer, Kraft Singles and Lunchables. When the company formed in 2015 it wanted to capitalize on its massive scale, but shifting tastes complicated those plans, with households seeking to introduce healthier options at the table. Kraft Heinz's net revenue has fallen every year since 2020.
