U.S. Consumer Spending Holds Up as $188 Fuel Hit Squeezes Lower-Income Households
Updated
Updated · CBS New York · May 21
U.S. Consumer Spending Holds Up as $188 Fuel Hit Squeezes Lower-Income Households
3 articles · Updated · CBS New York · May 21
Retail spending has stayed resilient despite sour consumer sentiment, with Walmart and other major chains reporting solid sales and April retail sales still healthy.
Higher-income households are driving much of that demand, while temporary support from tax refunds—up 12% to an average $3,276—has helped keep wallets open.
Lower- and middle-income consumers are already pulling back on discretionary purchases as gas prices add about $188 in costs per household since late February and inflation remains elevated.
Financial strain is showing up in credit use and bills: 22% of people ages 25 to 34 used buy-now-pay-later loans in the first quarter, and about 111 million Americans carry credit card debt.
Economists warn the split could widen if fuel prices stay high and wages keep lagging inflation, threatening the consumer spending that drives roughly two-thirds of U.S. economic activity.
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