American consumers spent at a faster pace than expected in May, delivering the fourth consecutive monthly gain in retail sales and offering fresh evidence that the U.S. economy is absorbing the shock of elevated energy prices without broad deterioration.

The Commerce Department reported that total retail and food-service sales rose 0.9% in May from April, beating the 0.5% gain that economists surveyed by Reuters had forecast. The figure followed an upwardly revised 0.4% increase in April and marked the strongest monthly gain in a year. Over the 12 months ending in May, sales were up 6.9%.

Behind the headline figure, the report painted a mixed but broadly resilient picture. Excluding volatile categories such as automobiles, gasoline, building materials and food services, so-called core retail sales rose 0.7%. Non-store retailers, a category that includes e-commerce, climbed 1.5%. Auto dealerships posted a 1.2% gain after a weak spring. At the same time, spending at restaurants and bars—the report's only services component—fell 0.1%, and electronics and appliance stores dropped 0.5%, suggesting that some households are growing more selective.

The strength in retail sales arrived alongside a Federal Reserve decision to hold interest rates steady in the 3.50% to 3.75% range. Policymakers updated their quarterly projections to signal that borrowing costs are more likely to rise than fall later this year, citing persistent inflation risks from energy markets. The U.S. and Iran announced an interim agreement on June 15 to end active hostilities and reopen the Strait of Hormuz, but the White House has cautioned that the accord is not final.

Economists noted that the spending resilience has been underpinned by large tax refunds and a sustained stock market rally, even as the personal saving rate fell toward a four-year low. Higher-income households have driven much of the growth, while lower-income families face disproportionate pressure from elevated gasoline prices. Elizabeth Renter, a senior economist at NerdWallet, warned that relying on credit to fuel spending is “not sustainable, not for households or the overall economy.”

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