On Wednesday, the US government will report retail sales for July. The Commerce Department said consumer spending grew at a 4% pace in the second quarter, and May and June were particularly strong. Wall Street analysts expect retail sales remained solid in July, even though consumer sentiment dipped a bit.
Investors will pay particularly close attention to retailers’ outlooks for the rest of the year to gauge how robustly consumers are expected to spend through the holidays. Higher inflation is beginning to eat into people’s paychecks. Wage growth has remained tepid, yet gas prices are rising, and tariffs have boosted prices on everything from cars to soda.