Consumer spending is healthy, but gas prices remain a risk
Higher-income shoppers have kept retail sales healthy, but the economic impact of the war in Iran presents an unknown, according to industry analysts.
Retail industry segments dependent on broad-based or price-sensitive spend are facing weaker outlooks, according to a report from Moody’s Ratings analysts. However, credit and debit card payment volume through the end of 2025 shows consumer spending remained healthy.
A growing dependence on higher-income households continues to be of concern, however, as spending growth within the economic cohort outpaced lower-income households who are prioritizing essentials and trading down.