Bank of America (BAC) reported better-than-expected first quarter earnings on Tuesday, though its net interest income fell 3% from a year ago.
Bank of America CEO Brian Moynihan joined Yahoo Finance Executive Editor Brian Sozzi to discuss the results, the state of the US consumer, and the Federal Reserve’s inflation fight.
On the consumer, Moynihan says that, from the data he is seeing, "US consumer activity is slowing down, but that is not stopping" and that the data is consistent with a more normalized US economy. He notes that "if you thought the consumer was really holding back because of inflationary prices they wouldn’t be spending on things that have price flexibility… but they are. They are spending on entertainment, restaurant spending is growing faster than food and store spending." He argues that means consumers are making discretionary purchases and necessary purchases at about the same levels as they were before the pandemic, which is a sign of normalization.
Overall, Moynihan believes the Fed is "winning" the fight against inflation, it’s just going to take time.
Watch the video above to hear Moynihan explain why Bank of America’s credit card business is seeing such success.
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