U.S. May Retail Sales Hold Firm, Inventory Risks Remain Low

Although May is typically a slow season for traditional retailers and monthly retail sales declined by 0.91%—largely impacted by prior strong auto sales—underlying figures suggest the data remains solid. With summer in full swing, seasonal demand for apparel is expected to sustain end-consumer spending, while peak travel season could continue to boost economic activity. Moreover, current business inventory levels indicate potential restocking momentum from brands, implying that the best is yet to come.

We believe the next surge in consumer demand is likely to come during Amazons Prime Day in July. Based on historical patterns, the discount event is expected to fall during the second week of July (7/8–7/11).

According to the 2025 Amazon Prime Day Study released by Tinuiti, over 80% of Prime members plan to shop on Amazon during this year‘s Prime Day, a significant increase from last year’s 68%. Additionally, 41% of respondents anticipate spending more than they did last year.

Looking back at commercial inventory performance, U.S. business inventories in April edged slightly lower, with year-over-year growth at 2.19%. The inventory-to-sales ratio held steady at 1.38. Continued monitoring shows that retail inventories in April have not experienced any major upward spikes.

(Figure 1. Total Business Inventory & Inventory-to-Sales Ratio; Source: FRED)

A deeper look into upstream, midstream, and downstream inventory-to-sales ratios reveals that manufacturing ticked up slightly from 1.57 to 1.58, while wholesale and retail levels remained unchanged at 1.30 and 1.29, respectively. When combined with U.S. May PMI backlogs, its evident that work-in-progress inventory has yet to be transmitted downstream.

This suggests the manufacturing cycle has not entered a destocking phase, but also reflects a conservative approach to procurement and inventory buildup.

(Figure 2. Inventory-to-Sales Ratio by Supply Chain Stage; Source: MacroMicro)

Next, reviewing the year-over-year breakdown of retail sales, Figure 3 shows that total retail sales rose by 3.29%, while the Core Retail Sales Control Group increased by 5.00%.

The Core Retail Sales Control Group excludes autos, gasoline, building materials, and restaurants—offering a clearer picture of true underlying consumption trends. A higher growth rate in the core figure compared to the headline retail sales suggests that real consumer demand remains resilient, with no evident signs of weakening or recessionary pressure.

(Figure 3. YoY Breakdown of Retail Sales; Source: MacroMicro)

Tracking these data points helps assess the health of the economy. In the near term, markets remain fixated on the upcoming FOMC meeting, with a strong sense of caution prevailing. Once the market volatility subsides, investors could be looking at more favorable swing trading opportunities.

Gold Technical Outlook

From a technical perspective, gold remains in a weak consolidation phase. We continue to use the Fibonacci 1:1 extension for reference, with the next downside target near the 3342 level. Traders should monitor resistance at 3409; a breakout above this level would warrant a neutral stance, while price action below suggests continued bearish positioning.

• Support: 3384 / 3342

• Resistance: 3396 / 3409

Risk Disclaimer:

The above viewpoints, analyses, research, price levels, or other information are provided as general market commentary and do not represent the official stance of this platform. All users are advised to evaluate risks independently and exercise caution when trading.