Skip to content

Consumer Spending Is Running Out Of Steam and the Market Isn’t Ready For It

  • Spending growth slowed in May, Barclays credit card data show
  • Corporate bonds, stocks will likely weaken more, bank says
U.S. Consumer Spending Tops Forecasts Even As Inflation Jumps
Photographer: David Paul Morris/Bloomberg

A key source of US economic growth this year -- consumer spending -- is showing signs of losing steam, even before Wednesday’s round of Federal Reserve rate hikes kick in. 

Credit card data show that spending in May was just 10% higher from the same month last year, according to a Barclays report this week. For the rest of 2021, that monthly spending growth has averaged more like 20%.