Retail sales growth in the United States slowed to its weakest pace in nearly a year during October, signalling that American consumers are becoming more cautious about spending as prices remain elevated. According to CNBC/NRF Retail Monitor data released Wednesday, total retail spending on a seasonally adjusted basis reached $561.7 billion in October, representing a 0.2% increase from September and 3.6% above October 2025. Core retail spending, which excludes restaurant purchases, rose 0.3% month over month to $454.2 billion, standing 3.4% higher year over year.
The slowdown marks the smallest monthly growth rate since November 2025, according to the data. Matthew Shay, chief executive of the National Retail Federation, said that households are managing budgets carefully and timing purchases around sales and special offers to stretch their dollars. Retailers are responding by offering more promotions and value pricing to keep everyday items and holiday gifts affordable. The monthly figure would have been even weaker if not for strong Halloween shopping and early holiday promotions, the NRF noted.
Electronics and appliances led spending gains across sectors year over year, with a 9.3% increase over the 12-month period, driven partly by technology companies raising prices for products like laptops and gaming consoles amid surging memory chip costs. However, other categories showed weakness. Furniture and home furnishings sales dropped 0.2% in October and fell 2.6% over the full year, likely hurt by the housing market slowdown as mortgage rates rose. Leisure spending on items such as sporting goods, music and books declined 0.4% on an annual basis, though it edged higher from September to October.
The retail slowdown comes as inflation continues to pressure household finances across the economy. The Bureau of Labor Statistics reported that the consumer price index increased 0.4% in October, slightly above what economists had forecast. Additionally, a National Federation of Independent Business survey released Tuesday found that a net 37% of businesses planned to raise prices over the next three months, the highest share since July 2022 when the economy faced energy price shocks from the Russian invasion of Ukraine.
For American savers and borrowers, slower retail sales growth combined with persistent inflation means household budgets are being squeezed harder, forcing consumers to choose between spending and saving while prices remain elevated.