Stock

U.S. inflation hit 8.5%: what’s happening with consumer spending?

The U.S. inflation jumped 8.5% in March – the highest since 1981. Still, consumer spending remains strong as ever, says Mastercard’s Michelle Meyer.

Highlights from Meyer’s interview on CNBC’s ‘Closing Bell’

According to the chief U.S. economist at the Mastercard Economics Institute, the consumer continues to spend not only on necessities but also on experiences. On CNBC’s “Closing Bell”, Meyer said:

Consumer is still out spending; more on necessities that likely reflects inflation impulse spending at the gas station or on food, but also very much on experiences. So, air travel, lodging, restaurants, and even still durable goods.

She confirmed that a trade-off between necessities and discretionary spending hasn’t been apparent so far, as per the data from Mastercard SpendingPulse.

What does the future look like for consumer spending?

Meyer attributes continued spending to savings, a strong labour market, and low debt ratios and unemployment rate. The future, she added, will depend on the persistence of inflation.

How long do we see the commodity prices at these high levels. How long do we see this broadness of inflation. Because consumers can’t withstand this indefinitely of course. At some point, you do start to see the stress kick in.

Meyer does see a moderation in economic growth but is “iffy” on the forecast of recession next year that Deutsche Bank signalled last week.

The post U.S. inflation hit 8.5%: what’s happening with consumer spending? appeared first on Invezz.

Disclaimer: MonopolyWinnersUpdates.com, its managers, its employees, and assigns (collectively "The Company") do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

Copyright © 2022 MonopolyWinnersUpdates.com. All Rights Reserved.

To Top