Wall Street is concerned about the recent retail sales report that shows a decline in American consumer spending.
- Consumer spending accounts for about 70% of America's gross domestic product, making it a critical factor for economic growth.
- Retail sales fell 0.4% in March, while core sales fell by about 1%.
- The Federal Reserve meeting minutes revealed that central bank economists predict a recession this year due to the recent banking crisis.
- Bank of America credit card data shows that spending is cooling, with the bank's credit and debit card spending easing in March to 0.1% YoY growth.
- BofA analysts suggest that the slowdown in Federal tax refunds in March contributed to the weakness in spending, adding that it's still relatively strong.
- American bank accounts are beginning to dwindle as consumers added $398 billion in new debt during Q4 2022, with bankruptcies also piling up.
- US corporate bankruptcy filings hit a 12-year high in the first two months of 2023, with several major chains on bankruptcy watch.