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US Consumers Cautious But Still Spending
26 Nov
Summary
- Retail sales saw a modest 0.2% increase in September.
- Consumer sentiment dropped to its lowest point in seven months.
- Retailers like Kohl's and Best Buy raised forecasts despite consumer anxiety.
Consumer spending in the United States has shown signs of slowing, with retail sales experiencing a mild 0.2% rise in September. This comes as consumer sentiment has fallen to its lowest point in seven months, driven by concerns over the labor market and overall economic conditions. This moderation suggests that the robust spending that fueled growth in recent years may be tapering off towards the end of the year.
Despite widespread anxiety about the economy, some retailers, including Kohl's and Best Buy, have surprisingly raised their sales forecasts. This suggests that consumers, while more cautious, are still willing to spend on familiar and trusted brands, especially for significant purchases. Best Buy, in particular, reported better-than-expected demand during back-to-school and an October sale, leading to optimistic predictions for Black Friday and Cyber Monday.
Looking ahead, over half of Americans anticipate spending at least the same amount this holiday season as the previous year, according to TransUnion. However, the overall economic picture remains mixed, with inflation and tariffs potentially impacting the availability of Black Friday deals. Federal Reserve officials are weighing interest rate adjustments amidst ongoing debates about the employment outlook and inflation.
