According to a Bank of America report, total card spending in American households witnessed a 1% year-over-year increase in April, surpassing the 0.3% growth observed in March. To shed light on this consumer spending trend, Bank of America Institute Senior Economist David Tinsley joins Wealth!
Tinsley characterizes the consumer spending momentum as "soft but stable." Notably, he highlights that low-income consumers continue to spend actively despite the inflationary environment, sometimes even outpacing higher-income consumers— saying this is due to the "labor market story".
He emphasizes that at the lower end of the wage and salary spectrum, growth remains robust at around 4% year-over-year. "The labor market has been very beneficial to the lower end over the last few years," Tinsley says, potentially fueling the continued spending.
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