July 2022

Chart of the Quarter

The Power of the Consumer

As the world returns to pre-Covid normal, what is in store for the markets? Different sectors and regions are going to vary at what pace “normal” returns. This continues to add uncertainty and market volatility. The runway for a soft Fed landing continues to narrow, and consumer sentiment remains extremely pessimistic. This uncertainty around the markets and Fed policy could lead the U.S. economy into a mild recession. The one bright spot is the power of the consumer. As you can see in the chart above, even as consumer sentiment continues to fall with uncertainty, the U.S. consumer continues to spend. This trend could continue this year and help the U.S. to avoid a recession or keep it mild if we fall into one.