According to the National Retail Federation (NRF), retail sales grew modestly in April amid overall weakened consumer spending. NRF Vice President of Industry and Consumer Insights Katherine Cullen joins Wealth! to discuss the state of the consumer as inflation remains relatively high.
Cullen notes that consumer spending is normalizing as shoppers across income spectrums face "shifts in their spending patterns." "They’re really prioritizing what’s important to them. And as we expected, we’re seeing a moderated level of spending on goods, though still above what we saw last year," she explains, adding that the retail industry is on track to achieve between 2.5% and 3.5% growth year over year.
As inflation continues to put pressure on wallets, consumers are prioritizing value. Cullen says that more consumers are choosing to swap out some private-label brands for discounted versions and pull back on dining out.
She believes consumer spending will continue as wages keep up with inflation. Cullen adds that the sporting, home, and gardening sectors are strengthening ahead of the summer season.
"This is a consumer that still feels comfortable, still feels somewhat confident in their own job security, and feels a level of comfortability continuing to spend," Cullen tells Brad Smith.
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