• Decline follows an early-spring surge and stimulus checks.

• Sales weakness is broad-based.

• April & March readings were upwardly revised.

Total retail sales including food service and drinking establishments declined 1.3% during May (+28.1% y/y). A 0.6% May decline had been expected in the Action Economics Forecast Survey. May's reading followed a 0.9% April increase, revised from no change. An 11.3% March increase also was revised upward from 10.7%. Sales excluding motor vehicles and parts fell 0.7% last month (+26.4% y/y) after little change during April, revised from -0.8%. The 9.8% March increase ex-auto was revised from 9.0%. A 0.5% rise during last month had been expected.

Sales in the retail control group, which excludes autos, gas stations, building materials and food services, declined 0.7% last month (+18.8% y/y) after easing 0.4% in April.

Motor vehicle purchases weakened 3.7% in May (+34.8% y/y) and reversed a 4.3% April rise. The decline compares to a 7.8% drop (+41.5% y/y) in unit sales of light vehicles. Spending at electronics & appliance stores fell 3.4% (+91.3% y/y) after rising 1.5% during April. Sales at general merchandise stores weakened 3.3% (+10.3% y/y) after falling 2.2% in April. Within that group, department store sales improved 1.6% (28.0% y/y) after a 0.6% decline. Furniture & home furnishing store sales weakened 2.1% (+66.6% y/y) following a 0.7% improvement. Nonstore retail sales edged down 0.8% in May (+7.9% y/y) after April's 0.3% easing. Sporting goods, hobby and book store sales fell 0.8% (+44.1% y/y) after weakening 2.3%. To the upside, spending at clothing & accessory stores rose 3.0% (+200.3% y/y) after falling 2.0% in April.

Building materials sales fell 5.9% (+10.5% y/y), the third sharp decline in the last four months. Gasoline service station sales rose 0.7% (57.0% y/y) after falling 1.1% in April. The gain reflected a 3.8% rise in gasoline prices (seasonally adjusted by Haver).

In the nondiscretionary sales categories, grocery & beverage store sales improved 1.0% in May (0.7% y/y) after rising 0.7% in the prior month. Health & personal care store sales rose 1.8% (25.6% y/y) following two months of strong increase.

Sales at restaurants and drinking establishments strengthened 1.8% (70.6% y/y) in May, the fourth month of strong increase in the last five.

The retail sales data can be found in Haver's USECON database. The Action Economics forecast is in the AS1REPNA database.