WASHINGTON (AP) — U.S. consumers spent slightly more at retail stores last month after ramping up their shopping in March to get ahead of tariffs.
Sales at retail stores and restaurants rose just 0.1% in April from March, a sharp slowdown from a 1.7% gain in the previous month. The big increase from February to March was fueled by a surge in car sales that reflected an effort by consumers to get ahead of the new auto tariffs that went into effect this month.
The slight decline after the March surge reflects the ongoing turmoil and uncertainty in the economy in the wake of Trump’s stop-and-go tariff policies. Many publicly-traded companies have decided to forego the usual practice of forecasting their revenues and earnings for the rest of this year because they say it’s not clear how things will evolve. And Americans are increasingly gloomy about the economy’s prospects, according to sentiment surveys.
Trump imposed sky-high tariffs on imports from China last month that fueled fears of a recession, higher inflation, and even the specter of empty shelves by the winter holidays. But on Monday the U.S. and China announced a deal that sharply reduced the duties, at least partly assuaging those concerns.
Retailers still face a lot of uncertainty around tariffs and how shoppers will react to higher prices after several years of sharply rising costs.
A government report, released Tuesday, showed that inflation cooled for the third straight month in April, though economists and many business owners expect inflation will climb by this summer.
Trump had imposed massive 145% import taxes on Chinese goods last month, thought they were reduced to 30% for the next 90 days in a deal announced Monday. China reduced its retaliatory duties to 10% from 125%.
_____
D'Innocenzio reported from New York City.