US consumers pull back on shopping US consumers pulled back on shopping in May, sending retail sales lower for a second straight month, while wholesale prices fell the most in nearly three years on lower food and energy costs. Retail sales fell 0.2 per cent last month, as expected, the commerce department said, following a 0.2 per cent decline in April that was originally reported as a 0.1 per cent increase. "The smaller gains in employment . . . appear to be taking a toll on spending," said Paul Dales, senior US economist at Capital Economics. Sales fell across a variety of categories, including building materials, down 1.7 per cent, general merchandise, down 0.5 per cent and food and beverage, down 0.2 per cent. However, fuel prices, which have been a drain on household budgets, eased, sending receipts at petrol stations down 2.2 per cent. The price for a gallon of regular petrol fell to an average of $3.71 in May from the year-to-date peak of $3.94 in early April, according to the American Automobile Association. That freed up some money that Americans spent on apparel, up 0.9 per cent after falling 1.2 per cent in April, electronics, up 0.8 per cent, and furniture, up 0.4 per cent. Motor vehicle sales were stronger than expected, accelerating to 0.8 per cent in May from 0.1 per cent in April. Stripping out auto sales, overall sales fell 0.4 per cent, the most in two years. Excluding both autos and gas, sales fell 0.1 per cent last month compared with an expected 0.4 per cent gain. Mr Dales said: "Looking ahead, the continued fall in gasoline prices should support consumption by freeing up cash to be spent on other items. So although real consumption growth looks set to slow in [the second quarter], we doubt it will grind to a complete halt. May retail sales were 5.3 per cent higher than a year ago, compared with a 5.6 per cent year-on-year gain in April. Separately on Wednesday, the labour department said its producer price index fell 1 per cent on a seasonally adjusted basis in May from April as costs of energy and food declined. The fall was steeper than the 0.6 per cent expected, following a 0.2 per cent monthly decrease in April. May's decline was the biggest since July 2009 and suggested that inflation pressures may be easing in a positive sign for consumers. The labour department's May consumer price index, a closely watched inflation measure, is set to be released on Thursday. Energy prices sank 4.3 per cent, the most since March 2009, led by an 8.9 per cent drop in petrol prices. Food costs fell 0.6 per cent, the most since December, as prices for meat, fresh fruit and melons all eased. Stripping out the volatile effects of fuel and food, core prices rose 0.2 per cent for a second consecutive month, in line with forecasts. Year-on-year, prices at the farm and factory gate rose 0.7 per cent on an unadjusted basis last month, the smallest increase since October 2009. Core prices rose 2.7 per cent in that period. Headline inflation has been slowing on an annual basis every month since September.