Let’s start with consumer staples — things like toothpaste, cleaning supplies and other packaged goods.
Brittany Quatrochi, an analyst at Edward Jones, said while consumers have been pulling back, the scale has been “much less than what you would have expected, based off of the magnitude that we’ve seen of those price increases.”
On the other hand, we’ve been seeing signs that people are cutting back more on discretionary purchases — think clothing toys and electronics.
“Most of the retailers have discussed how the consumer is being very selective,” said Mickey Chadha. senior credit officer at Moody’s.
A lot of people are still choosing to spend more on services. Last week, Uber said revenue jumped almost 50% last quarter. But Chadha said services spending could fall.
“Some of that strength is going to weaken as the consumer feels a lot more stressed,” Chadha said. “In terms of how much money they have in their pocket.”
That said, consumers will continue to spend as long as the labor market stays strong, according to Chadha.
There’s a lot happening in the world. Through it all, Marketplace is here for you.
You rely on Marketplace to break down the world’s events and tell you how it affects you in a fact-based, approachable way. We rely on your financial support to keep making that possible.
Your donation today powers the independent journalism that you rely on. For just $5/month, you can help sustain Marketplace so we can keep reporting on the things that matter to you.