U.S. Inflation, Retail Sales, and Residential Construction Trends Signal Early Inflation Reacceleration

Inflation in the U.S. accelerated in June, with the Consumer Price Index (CPI) rising 2.7% year over year, indicating early signs of inflation driven by tariff impacts. Retail sales surpassed expectations for June, showing growth across most categories, and real terms retail sales were also higher compared to the previous year. Residential construction activity increased in June, led by growth in multifamily housing permits and starts, while single-family housing continues to decline. Consumer sentiment improved in early July, supported by declining inflation expectations. Cox Automotive's Economic and Industry Insights team is monitoring tariff developments and their effects on the automotive and broader economic sectors, providing regular analysis informed by proprietary data.