Macro Briefing: 18 August 2025

US retail sales rose for a second month in July, highlighting consumer resilience. The news eased concerns that consumer spending is vulnerable to tariff-induced inflation. “As long as consumer spending holds up and companies are able to retain workers because of that robust spending, the flywheel can continue to spin, pushing corporate profits and stock prices higher,” Chris Zaccarelli, chief investment officer at Northlight Asset Management, said in commentary issued Friday.

US import prices rebound in July on higher, driven by increases in consumer goods costs. Import prices increased 0.4% last month after a downwardly revised 0.1% dip in June, the Labor Department’s Bureau of Labor Statistics said on Friday.

US industrial output fell in July, marking the first monthly decline since March. The Federal Reserve reported that production edged down by 0.1% in July after rising by an upwardly revised 0.4% in June.

Business activity grew modestly in New York State in August, according to firms responding to the Empire State Manufacturing Survey. The headline general business conditions index rose six points to 11.9, its highest reading in several months.

The US Consumer Sentiment Index fell in August, declining for the first time in four months, according to survey data published by the University of Michigan. “This deterioration largely stems from rising worries about inflation,” the report advised.