Key Engines of US Consumer Spending Are Losing Steam All at Once
==========
Real disposable incomes have risen only modestly over the past year. The saving rate now stands at a 16-month low as households have mostly exhausted the extra pile of cash they squirreled away during the pandemic. In turn, many Americans are increasingly relying on credit cards and other sources of financing to support their spending. These factors help explain why real spending — which excludes the impact from inflation — fell in April, with consumers shelling out less on cars, restaurants and recreational activities. With the job market also cooling, companies like Best Buy Co. have noticed a change in recent months as shoppers switch to cheaper brands. Slower labor market momentum will continue to limit income growth and push more families to exercise spending restraint amid reduced savings buffers and higher debt burdens. The dip in April consumer spending reported Friday and the recent downward revision to the government’s estimate for gross domestic product in the first quarter provide fairly convincing evidence the US economy is coming off the surprisingly strong pace it set in 2023. Recent company earnings indicated that consumers have increasingly been prioritizing staples over large discretionary items. And higher-income consumers are trading down or hunting for deals, which helped boost sales at Walmart Inc. and discount retailer Dollar General Inc.
#UsEconomy #ConsumerSpending #Inflation #SavingRate #CreditCards #IncomeGrowth
https://finance.yahoo.com/news/key-engines-us-consumer-spending-140000015.html
Yahoo Finance /
npub1j0e…3yhd
2024-06-02 16:55:20
Author Public Key
npub1j0e6zhr82q4par2f4ecr67zvj0ltv8qgqr8v3llw2ed6qvdrm4fs9s3yhdPublished at
2024-06-02 16:55:20Event JSON
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"content": "Key Engines of US Consumer Spending Are Losing Steam All at Once\n==========\n\nReal disposable incomes have risen only modestly over the past year. The saving rate now stands at a 16-month low as households have mostly exhausted the extra pile of cash they squirreled away during the pandemic. In turn, many Americans are increasingly relying on credit cards and other sources of financing to support their spending. These factors help explain why real spending — which excludes the impact from inflation — fell in April, with consumers shelling out less on cars, restaurants and recreational activities. With the job market also cooling, companies like Best Buy Co. have noticed a change in recent months as shoppers switch to cheaper brands. Slower labor market momentum will continue to limit income growth and push more families to exercise spending restraint amid reduced savings buffers and higher debt burdens. The dip in April consumer spending reported Friday and the recent downward revision to the government’s estimate for gross domestic product in the first quarter provide fairly convincing evidence the US economy is coming off the surprisingly strong pace it set in 2023. Recent company earnings indicated that consumers have increasingly been prioritizing staples over large discretionary items. And higher-income consumers are trading down or hunting for deals, which helped boost sales at Walmart Inc. and discount retailer Dollar General Inc.\n\n#UsEconomy #ConsumerSpending #Inflation #SavingRate #CreditCards #IncomeGrowth\n\nhttps://finance.yahoo.com/news/key-engines-us-consumer-spending-140000015.html",
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