U.S. Consumers are still spending their money, just not so much on larger non-essential purchases this year. A survey conducted by the New York Federal Reserve and reported by Reuters showed that consumers are still expected to spend more on daily living expenses this year, but will be less likely to spend their money on larger non-essential purchases, such as vacations, home repairs, etc.
According to Reuters, spending on everyday essentials is predicted to increase by a median of 5.4% this year, while spending on non-essential or larger items is predicted to only increase (slowly) by a median of 2.5% this year. In the survey, many U.S. consumers expect their monthly household spending to increase by a median of 4.6% throughout 2022.
With a disrupted supply chain (and a shortage of goods), U.S. consumer prices continue to rise. Lately retailers have struggled on what decisions to make regarding inventory and worry about not having enough supplies to meet the demand. According to Reuters, retail inventories have shot up 4.4% in December, just after a increase in November by 2%.
In addition – U.S. Goods imports have increased 2%, which has been driven by capital goods, motor vehicles and consumer goods reported Reuters. However, imports of food and industrial supplies have decreased. On the U.S. export side of things, they rose 1.4%, driven by consumer goods, industrial supplies, and motor vehicles – with food exports decreasing, Reuters reported.
Even with the ongoing supply chain disruptions, omicron variant and amongst other things, consumers are still going to continue shopping, some will just change certain shopping habits. If you would like to learn more and if this has a direct impact for you, reach out to a member of our team today!