American consumers resist higher prices, signaling the end of the US inflation spike. Major companies notice customers seeking bargains or avoiding expensive items, resembling pre-pandemic behavior aimed at limiting price increases. This resistance aligns with the Federal Reserve's 2% inflation target, supported by improved supply chains and high interest rates that cool the housing and auto markets. While consumer spending drives over two-thirds of economic activity, fears of economic risks arise from potential spending pullbacks. Government updates this week are expected to show slight inflation reduction and cautious but ongoing consumer spending. Companies like Amazon and Yum Brands see price-conscious behavior affecting sales, even leading some to cut prices. Economists maintain that consumer spending remains robust enough to support the economy, but the tolerance for price hikes has decreased markedly post-pandemic, shifting pricing power dynamics back to consumers.
Learn more on this news visit us at: https://greyjournal.net/
Hosted on Acast. See acast.com/privacy for more information.
