Grocery Sales Trended Down Last Month
Consumers reined in their spending last month, as ongoing macroeconomic conditions remained volatile. The latest report from the U.S. Census Bureau shows that overall retail and foodservice sales dipped 0.9% and grocery sales slid 0.8% from April to May.
Grocery sales topped out at $75.34 billion on an adjusted basis last month, compared to $75.91 billion the prior month. On a year-over-year (YoY) basis, grocery sales were up 2.3%; that uptick is in line with the inflation rate, as the grocery Consumer Price Index (CPI) rose 2.2% from May 2024 to May 2025.
[RELATED: Food Prices Continue Familiar Pattern of Volatility]
Other recent market research reveals some sales trends within grocery categories. According to a series of May sales reports published by San Antonio-based insights firm 210 Analytics, meat department sales were fueled by inflation to a 6.1% YoY lift and fruit sales increased based on strong demand for berries, grapes and citrus fruits. On the down side, three out of four main vegetable segments experienced sales declines, as did deli meats and bakery.
The pullback in May reflects shoppers’ cautious sentiment, even when buying grocery necessities.
One retail expert expects similar mindsets as market headwinds and geopolitical issues continue to dominate headlines. “I expect consumer spending to remain cautious, driven by ongoing economic uncertainty. Shoppers will continue prioritizing deals over brand loyalty, making them more responsive to promotions and discounts. This environment is likely to accelerate early shopping behavior, with consumers starting their back-to-school and holiday purchases even sooner to secure the best value and ensure product availability,” said Chip West, retail and consumer behavior expert at RRD.
The good news is that shoppers and retailers have become – for better or worse – accustomed to calibrating their spending, even in the wake of tariff fallout and international conflict.
“Many anticipated price hikes from tariffs have yet to materialize, except in a few import-sensitive sectors. Steady job growth, easing inflation, and a rebound in consumer confidence in May likely helped stabilize spending,” West observed. “Retailers continue to adapt to shifting trade policies and economic conditions. Today’s cautious, informed consumer is carefully managing finances and prioritizing purchases. Near-term spending will closely track key economic indicators, especially shifting consumer sentiment.”
He also pointed to some opportunities for grocers as shoppers remain mindful. “With more consumers considering scaling summer travel plans, staying closer to home and planning gatherings with friends and family will likely become more popular. Celebrating graduations, Independence Day, and anniversaries will have shoppers looking to grocery stores to supply their festivities,” he predicted.
Jack Kleinhenz, chief economist at the National Retail Federation, also weighed in on the latest sales data that reflects a mix of resilience and concern. “We’re continuing to see growth for core retail sales this year at about the same pace as last year,” he said. “Despite a soft labor market, aggregate consumer spending has been supported by wage gains and an improvement in the stock market. Consumers are seeing their way through the uncertainty with trade policies, but I expect the inflation associated with tariffs to be felt later this year. Consumers remain very price sensitive, and those costs are likely to weigh heavily on consumer budgets.”
