The outlook for consumer goods spending remains relatively positive in the short-term—despite increasing headwinds from price inflation evident in the latest data—given signs from key economic and consumer indicators.
The signs are distilled from the data storyboard below, which is based on economic sources and the consumer sentiment index created by MacroSavvy™ using data from Prosper Insights & Analytics™.
GDP. Q2 data won’t be available until the end of July. In Q1, the U.S. economy slowed largely because of weaker consumer spending. The results confirmed a post-holiday return to a less robust pace of consumer spending. For more, see post here.
Jobs. Signs from job gains suggest the economic outlook may improve from a modest start to the year—despite trade and inflation-related threats. The job gains, however, remain skewed toward Western and some Southern states and metro markets. For more, see post here.
Prices. Consumer price inflation continues to slowly become a bigger threat—especially in the form of rising energy prices. Rising prices for services and food are adding to the threat. The threat likely will further squeeze consumer goods (i.e., retail), where prices continue to fall.
Confidence. Key to the outlook in the short term are Millennials, whose spending confidence remains on a strong upward trend. They led consumers’ confidence to spend higher in June—with clothing, health and beauty benefiting most. For more, see post here.
Retail & consumer goods. The sales trend in 2018 for retail and consumer goods suddenly looks stronger as a result of a healthy month of May and upward revisions to prior months as reported by the government. For more, see post here.
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