The trend: There’s a growing split among the consumer behaviors exhibited among lower- and higher-income consumers.
A difficult landscape: There are a host of indicators that suggest a challenging economic picture:
But luxury sales continue to soar: While mass merchants such as Target and Walmart have warned investors that inflation is hurting their near-term outlook, wealthy consumers appear unfazed by the negative news.
Why it matters: While merchants that serve high-income consumers continue to be immune to the challenging economic climate, inflation is starting to have a significant impact on consumer spending. That’s particularly true among lower-income consumers who are also likely to be hit hard by rising interest rates that make it harder to pay off credit-card loans and buy big-ticket purchases such as cars. That could stymie retail sales in the latter half of the year.
Go further: For more on The Era of Uncertainty, read the report here.
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