MW Retail sales fizzled out at the end of last year. Tariffs altered American's buying habits

By Jeffry Bartash

Retail sales soared in the spring and summer and slowed in the final months of 2025

People shop at a Best Buy store. Retailers ended 2025 on a weak note.

Sales at U.S retailers fizzled at the end of the holiday shopping season, suggesting consumers worried about the economy might be cutting back on spending as a new year got underway.

Retail sales were flat in December, the government said Tuesday in a report delayed by the federal shutdown last fall. The numbers are seasonally adjusted.

Fourth-quarter sales more broadly were also on the softer side.

Americans spent more money than they usually do in the spring and summer to avoid price increases tied to higher U.S. tariffs. It appears they scaled back purchases in the second half of the year to compensate.

Retail sales represent a large slice of consumer spending, the main pillar of growth for the U.S. economy.

In the 12 months ended in December, retail sales increased a decent but bellow-trend 3.8% in unadjusted terms.

Key details: Home centers such as Home Depot and Lowe's were the only retailers to post outsized sales in December. Outlays jumped 1.2%, the government said.

Sales fell at auto dealers, clothing stores, pharmacies and big-box electronics retailers.

One of the most critical retail bellwethers, restaurants, saw a slight decline in sales in December.

People dine out or buy more takeout when they are confident about the economy. They eat out less when they are anxious about their jobs.

Still, restaurant sales rose a solid 4.5% in the 12 months ended in December. And sales were stable in the waning months of 2025.

Big picture: The U.S. economy grew faster than expected last year despite high tariffs and consumers were the chief reason why. They spent a lot of money - purchases of goods and services rose faster than the rate of inflation

Some of the spending was skewed, to be sure, by richer households that have seen a big increase in wealth due to soaring stocks and rising home values. Middle- and lower-income Americans did not fare as well.

Market reaction: The Dow Jones Industrial Average DJIA and S&P 500 SPX were set to open lower in Tuesday trading.

-Jeffry Bartash

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February 10, 2026 08:54 ET (13:54 GMT)

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