US retail and food services sales rose 0.8% in September to $745B, the Commerce Department reported. Economists polled had expected a 0.4% increase.
The gain followed an upwardly revised 1.3% rise in August.
Most of the dollar increase came from the gas pump. Sales at gasoline stations increased 6.4% over the month, while total sales excluding gas stations edged up just 0.2%.
The Energy Information Administration recorded a roughly 7.1% jump in gasoline prices during the month, meaning shoppers bought similar amounts of fuel for more money.
Core spending slowed to a crawl
The control group strips out autos, gas, building materials, and restaurants, and feeds directly into gross domestic product estimates. It grew by only 0.1%, down from 1.2% in August.
September 2026 US Retail Sales, Month-Over-Month % Change
As of September 2026, US Census Bureau advance estimates
Bar chart. % Change (MoM). Headline: % Change 0.80%. Gas Stations: % Change 6.40%. Excl. Gas Stations: % Change 0.20%. Excl. Autos & Gas: % Change 0.25%. Control Group: % Change 0.10%.
Private data tells a similar story. The CNBC/NRF Retail Monitor put sales excluding auto dealers and gas stations at $560.8B, up 0.28% month over month and 4.05% from a year earlier.
NRF's president and chief executive added that retailers leaned on promotions and value pricing to keep everyday products within reach.
Producer prices surprised to the upside
The producer price index, which tracks what businesses charge each other, climbed 1.3% in September and 6.3% year over year, well above the 0.6% monthly consensus.
Energy drove much of the increase as the Middle East conflict curtailed oil supply, per the Bureau of Labor Statistics.
Core producer prices, excluding food, energy, and trade, still rose 0.5%, a sign cost pressures are spreading beyond fuel.
The combination has shifted rate expectations. A growing minority of Fed funds futures traders now expect the central bank to raise rates at its meeting later this month.
Spending is also splitting by income. The Federal Reserve's Beige Book shows higher-income households doing most of the spending, while lower-income consumers turn cautious and real wages fell in September.
Banking economists read the report more positively, pointing to continued resilience of consumers and noting that stronger sales could support demand for consumer loans.
Year over year, retail sales were up 6.2% from September 2025.
The split between headline strength and core softness is the number to watch heading into third-quarter growth data.
