Retail Spending Slows, Small Business Confidence Drops

December retail sales remained flat month‑to‑month, a sharp drop from the expected rise after November’s rebound. The decline marks the slowest year‑over‑year growth since September 2024.

Key Sector Movements
Motor vehicle and clothing purchases fell the most.
Building materials and food & beverage spending grew the most.
Core Retail Sales
Held steady, missing a modest 0.4 % increase analysts had hoped for.
GDP Control Group
Slipped 0.1 % this month, well below the projected 0.4 % gain.
Suggests overall economic activity may be cooling more than previously thought.

Adjusted Real Retail Sales
Fell year‑over‑year in December, indicating consumers are buying less even when prices are considered.
Seasonality & Smoothing
Some experts attribute the slowdown to seasonal effects and data smoothing, but questions remain about consumer confidence recovery.
Small‑Business Outlook (January)
NFIB Optimism Index dipped 0.2 points to 99.3, the first decline in three months.
Most of its ten components decreased.
Primary Concerns for Small Firms
Taxes and labor quality remain top worries, potentially weighing on future spending and hiring decisions.

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