July Retail Sales Fell 1.1% as COVID-19 Surge Hits Spending

Americans cut back on their spending last month as a surge in COVID-19 cases kept people away from stores.

Retail sales fell a seasonal adjusted 1.1% in July from the month before, the U.S. Commerce Department said Tuesday. It was a much larger drop than the 0.3% decline Wall Street analysts had expected.

The report is the first glimpse into whether a surge in COVID-19 cases in July has kept people from heading out to shop. At the end of July, the U.S. Centers for Disease Control and Prevention began recommending that even vaccinated people start wearing masks indoors in public places due to the delta variant which is causing a spike in COVID-19 cases.

According to Tuesday's report, spending fell at stores that sell clothing, furniture and sporting goods.

Major retailers are releasing their financial results this week, which may also offer clues into whether there have been any changes in shopping behavior.