Seasonally adjusted U.S. retail sales rose by 0.5% between July and August, as back-to-school shoppers rushed to make purchases ahead of expected tariff-driven price increases in the back half of the year.

According to a September 12 release from the National Retail Federation, core retail sales — which excludes autos, fuel and restaurants — increased 0.26% month-to-month in August, and 6.67% compared to August 2023. While that pace has moderated from July’s stronger 1.45% month-to-month increase, overall growth is still above pre-pandemic norms.

"Even with weaker job growth than many expected, employment remains stable and at a high level, giving consumers the ability to spend thoughtfully on household priorities," NRF president Matthew Shay said. However, Shay also noted that shoppers are becoming more price-sensitive, and have been shifting discretionary budgets as inflation and new tariffs have already started to raise the cost of certain core goods.

Breaking the NRF's data out by product category, digital goods such as e-books and video games saw a 1.6% seasonally adjusted month-to-month jump in August, with gains ranging between 0.2% and 1% recorded in apparel, general merchandise, groceries and sporting goods. In contrast, sales dipped month-over-month in electronics, health and personal care, and building and garden supply.

This comes ahead of the Federal Reserve scheduled September 17 decision on whether to cut benchmark interest rates, which could help ease borrowing costs for businesses and consumers, but also risks driving inflation rates up if the Fed moves too quickly.