U.S. retail sales increased 0.5% in April compared to March, according to Commerce Department data released Thursday, marking a slowdown from the revised 1.6% growth recorded in March. The April figure represents a deceleration in consumer spending as higher gasoline prices left shoppers with less disposable income for other purchases.

Wholesale prices jumped 6% in April compared to the same month last year, marking the highest annual increase in more than three years. Gas prices were identified as the primary driver of this inflationary pressure, with the increases linked to ongoing conflict involving Iran.

When gasoline purchases were excluded from the retail sales calculation, the growth rate dropped to 0.3% in April. This suggests that much of the overall sales increase was attributable to higher fuel costs rather than increased volume of goods purchased.

Several retail categories showed declining sales during the month. Department store sales fell 3.2%, while furniture and home furnishing stores experienced a 2% decrease. These declines indicate consumers may be prioritizing essential purchases over discretionary items as gas prices consume a larger portion of household budgets.

Online retailers bucked the downward trend with a 1.1% increase in sales. Restaurant sales, the only services category included in the retail data, rose 0.6% during April.

The retail sales data provides a partial view of consumer spending patterns and does not include expenditures on services such as travel and hotel accommodations. March had recorded the largest monthly increase in retail spending in more than three years, largely driven by rapidly rising gas prices during that period.