Retail spending dropped slightly in February compared to the previous month, reflecting consumer concerns over tariffs and economic uncertainty, according to data recently released by the National Retail Federation (NRF). However, sales remained higher than the same period last year, signaling continued economic strength.

“Unease about the probability of inflation and paying higher prices for nondiscretionary goods has the value-conscious consumer spending less and saving more,” says NRF president and CEO Matthew Shay. “But for the moment, year-over-year gains reflect an economy with strong fundamentals.”

The CNBC/NRF Retail Monitor, powered by Affinity Solutions, reported a 0.22% decline in total retail sales, excluding auto sales and gas stations, on a seasonally adjusted basis from January to February, while unadjusted year-over-year sales rose by 3.38%. Core retail sales, which exclude restaurants in addition to auto sales and gas stations, saw a 0.22% monthly decline but an increase of 4.11% compared to February 2024.

The dip in monthly spending follows new tariff announcements in early February. The Trump administration imposed 10% tariffs on Chinese goods and initially set 25% tariffs on imports from Canada and Mexico, though the latter were delayed until April. The tariffs on Chinese imports were later raised to 20%. At the same time, consumer confidence weakened, with the University of Michigan’s Index of Consumer Sentiment falling to 64.7 in February, down from 71.7 in January.

Despite the short-term decline, retail sales have grown 4.41% year over year in the first two months of 2025, with core sales up 4.91%. This compares to a 3.6% increase for all of 2024.

Retail categories varied in performance. Sales were higher than last year in six out of nine categories, with online retailers, health and personal care stores, and general merchandise stores seeing the most growth. On a monthly basis, however, spending fell in most categories.

Here are some specifics from key sectors seasonally adjusted month over month and unadjusted year over year:

• Online and other non-store sales were up 0.46% from last month and up 36.51% compared to last year.
• Health and personal care stores were down 0.44% from last month but up 8.33% compared to last year.
• General merchandise stores were down 0.42% from last month but up 6.2% compared to last year.
• Grocery and beverage stores were down 0.07% from last month but up 4.08% compared to last year.
• Clothing and accessories stores were down 0.78% from last month but up 3.75% compared to last year.
• Sporting goods, hobby, music, and bookstores were up 0.93% from last month and up 3.57% compared to last year.
• Electronics and appliance stores were down 0.43% from last month and down 0.06% compared to last year.
• Building and garden supply stores were down 1.02% from last month and down 3.34% compared to last year.
• Furniture and home furnishings stores were down 1.01% from last month and down 3.67% compared to last year.