Retail sales fell sharply in May as consumers pulled back from a spending surge early this year to get ahead of President Donald Trump’s sweeping tariffs on nearly all imports.

Sales at retail stores and restaurants dropped 0.9% in May, the Commerce Department said Tuesday, after a decline of 0.1% in April. Sales jumped 1.5% in March. The figure was pulled down by a steep drop in auto sales, after Americans ramped up their car-buying in March to get ahead of Trump’s 25% duty on imported cars and car parts. Excluding autos, sales fell 0.3% in May.

The sales drop is hitting after sharp declines in consumer confidence this year. Still, inflation has cooled steadily and unemployment remains low, which could fuel steady spending in the coming months, as the economy has remained mostly solid.

A category of sales that excludes volatile sectors such as gas, cars, and restaurants rose last month by 0.4%, a sign that consumers are still spending on some discretionary items.

Overall, the report suggests consumers have pulled back a bit but not dramatically so. The retail sales report covers about one-third of consumer spending, with the other two-thirds consisting of spending on services. Economists expect overall consumer spending to grow in the April-June quarter.

Car sales plunged 3.5%, while sales at home and garden centers dropped 2.7%. They fell 0.6% at electronics and appliance stores and 0.7% at grocery stores. There were some bright spots: Sales rose 0.9% at online retailers, 0.8% at clothing stores, and 1.2% at furniture stores.

Gas station sales dropped sharply, by 2%, but that mostly reflects lower prices. The retail sales report isn’t adjusted for inflation.

Sales at restaurants and bars, a closely watched indicator of discretionary spending, fell 0.9% in May, though that followed a solid gain of 0.8% in April.

The retail sales report comes as other evidence indicates shoppers have been pulling back more amid worries about higher prices from Trump’s tariffs.

So far, the tariffs haven’t yet boosted inflation. Consumer prices rose just 2.4% in May compared with a year ago, the government said last week.

— Associated Press

General Mills to remove all artificial colors

General Mills said Tuesday it plans to remove artificial colors from all its U.S. food lines by the end of 2027. It will begin by removing artificial colors from all foods served in K-12 schools by summer 2026.

The move follows a similar one announced Tuesday by competitor Kraft Heinz.

The Golden Valley-based company said in a news release that 85% of its retail portfolio is made without certified colors.

Similarly, Kraft Heinz said Tuesday that almost 90% of its U.S. products already don’t contain food, drug & cosmetic (FD&C) colors. FD&C colors are synthetic additives that are approved by the U.S. Food and Drug Administration for use in food, drugs and cosmetics.

Senate passes crypto stablecoin regulations

The Senate passed legislation Tuesday that would regulate a form of cryptocurrency known as stablecoins, the first of what the industry hopes will be a wave of bills to bolster its legitimacy and reassure consumers.

The fast-moving legislation, which passed by a 68-30 vote and will be sent to the House for potential revisions, comes on the heels of a 2024 campaign cycle in which the crypto industry ranked among the top political spenders in the country, underscoring its growing influence in Washington and beyond.

A number of Democratic senators showed support for the legislation as it advanced, siding with the Republican majority in the 53-47 Senate.

Still, most Democrats opposed the bill. They raised concerns that the measure does little to address President Donald Trump’s personal financial interests in the crypto space.

— From news services