The move carries some risk.
Wealthier Americans are driving much of the growth in spending, while lower-income consumers are falling further behind.
Consumers are shopping for bargains at summer sales and small luxuries but spending less at restaurants.
About a quarter of the 3.3% price increase recorded by this month’s producer price index was driven by a spike in wholesale prices for veggies.
Household furnishings and supplies showed a 0.7% increase from June to July. Footwear is up 1.4%. Infant and toddler apparel is up 3.3%.
The latest 90-day pause on higher tariffs are causing more stress than relief for some business owners.
Although overall inflation has been high since the pandemic hit, some consumer goods and services have stagnated or gone down in price over the last five to six years.
Weathering changing tariff policy has been a “rollercoaster of emotions” for Daniella Velazquez de León at Organics Unlimited.
Same-store sales for KFC and Pizza Hut declined in the last quarter. Sales at Taco Bell, its more budget-friendly brand, grew at a slower pace.
As electronic labels roll out in grocery stores across the U.S., consumers and lawmakers fear they could lead to surge pricing.
