The Wall Street Journal has just put out a statement that the October consumer spending numbers are down from where they were in September. The article says that this new number is the lowest it has been since May of this year. This decrease in spending is not shocking to me. It honestly is to be expected at this time of year. People are preparing for the holiday season and student loans are starting back during this time of the year. The average consumer is spending to spend more later on. This is normal for the average American to want to save only to spend more in the future.
Some economists speculate that this dip in consumer spending and slowing inflation will lead to the Fed finally slowing the increases in interest rates. It will be interesting since even though these numbers are decreasing the overall economy is still growing. The new GDP numbers that came out support this statement. It will be interesting to see how the Fed responds to these new numbers.
Article:
https://www.wsj.com/economy/consumers/inflation-consumer-spending-personal-income-october-2023-6a1ecb1d?mod=economy_lead_story
Maria, this is interesting as it is the holidays and I know even though I do not want to spend money I am due to Christmas coming up. I agree that people saved to spend in November/December for Christmas most defiantly. I am interested to see what the 4th quarter will end up being and the new GDP. I know in January I will be pretty frugal due to all the spending I am doing currently preparing for Christmas.
ReplyDeleteMaria, I agree with you that it is hard to have extra money in October. The summer winds down in September and then one must get ready for the holiday season. People are definitely saving up for the holidays and avoiding certain purchases this time of year. This was very interesting to me because I had never really thought about which months I am more aware of my spending in terms of what I have coming up.
ReplyDeleteMaria, I appreciate this post as it shows the relevance of business cycles on consumer spending. Consumer spending is what allows businesses to operate and at this time of year (Q3) it is likely that consumers will begin saving in preparation for the holiday season which is quickly approaches. Good attention to detail.
ReplyDeleteThis post was a great read Maria. I am interested in Consumer spending because as a business major myself I am trying to learn how to get outside of the consumer mindset. This makes it easier to understand and do that. Overall I agree that it hard to have extra money in the holiday season as well.
ReplyDeleteI am very interested to see how the Fed responds to these numbers. I believe that interest rates will continue to slow down, and then will have to bring their rate up again
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