US retail sales recorded a slight increase in June, as lower gasoline prices limited revenues at gas stations, while consumers seeking deals and discounts continued to support core spending.

The Census Bureau of the US Commerce Department announced on Thursday that retail sales rose 0.2 percent last month, after May data was revised upward to growth of 1 percent.

Economists polled by Reuters had expected sales, which mostly consist of goods and are not adjusted for inflation, to rise 0.2 percent, after a preliminary reading indicated a 0.9 percent increase in May. Estimates ranged from a decline of 0.4 percent to an increase of 1 percent.

Data from the US Energy Information Administration showed the average gasoline price fell to $4.18 per gallon in June, compared to $4.61 in May.

The decline in fuel prices, driven by lower oil prices amid a temporary ceasefire between the United States and Iran, provided more room for households to shift spending to other sectors. However, the collapse of the truce last week and the resumption of military operations in the Middle East have pushed oil and gasoline prices back up.

In contrast, core retail sales, which exclude automobiles, gasoline, building materials, and food services, rose 0.5 percent in June, after their May growth was revised to 0.8 percent. This reading is closely related to the consumer spending component of GDP, and previous data had indicated growth of 0.7 percent in May.

It is likely that Amazon's 'Prime Day' event at the end of the month, along with promotional campaigns launched by competing retailers, supported the rise in core sales.

The FIFA World Cup is also believed to have contributed to increased revenues at restaurants and cafes.

The Bank of America Institute reported in a Wednesday release that analysis of payment card data showed spending has returned to growth at discount clothing stores and budget grocery stores since the beginning of the year, noting that 'price-sensitive consumers are increasingly turning to general merchandise stores in search of deals and discounts.'

Tariffs on imports, along with the repercussions of the conflict in the Middle East, continue to pressure household budgets. However, spending remains supported by high-income households, which have benefited from gains in stock markets.

The institute added that low-income households have become more inclined to buy lower-cost goods, noting that their spending rate at discount clothing stores has been five times that of high-income households since the beginning of 2026.

The Federal Reserve's Beige Book report, released on Wednesday, also showed that consumer spending rose slightly in early July, noting that many districts saw a decline in spending on non-essential goods or a shift toward cheaper alternatives.

Economists expect consumer spending, which accounts for more than two-thirds of the US economy, to regain momentum in the second quarter, after nearly stalling in the first quarter (January-March).