The challenge: Consumer spending remained resilient in January even as inflation ticked up.
The combination of stronger-than-expected economic activity and slower-than-expected progress on inflation will likely drive the US Federal Reserve to continue hiking interest rates.
Retailers look ahead: The past few years have presented retailers no shortage of unexpected challenges and shifts in consumer spending patterns, which is why many have come to bake the unforeseen hiccups into their guidance.
The big takeaway: Despite the uptick in consumer spending in January, we expect growth to slow throughout this year as the Fed continues to hike interest rates to curb demand and weaken inflation.
This article originally appeared in Insider Intelligence's Retail & Ecommerce Briefing—a daily recap of top stories reshaping the retail industry. Subscribe to have more hard-hitting takeaways delivered to your inbox daily.
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