“People want to do things,” the head of economics at Renaissance Macro Research, recently said/
He pointed to data from travel site Kayak, which showed searches for domestic and international flights continued to trend higher in March from their lows of December. That is Bullish!
The recovery in travel demand has defied worries about energy prices and geopolitical risk.
“Why? I think the answer is obvious,” he said, pointing to data from polling firm Civiqs. “The trajectory of COVID offsets energy prices for the time being. Indeed, concerns around coronavirus have collapsed lately.“
American consumers are sitting on trillions of dollars worth of excess savings that they can spend, helping to pay for the rising costs of goods and services.
The current surge in non-discretionary inflation particularly food, energy, and shelter will pressure households’ budgets and lead many of them to pare back their discretionary purchases, while supply-chain issues will continue to constrain sales growth.
But robust labor income growth, record levels of household wealth and ample excess savings worth 13% of GDP mean that consumer spending should remain supported in the months ahead.
Have a healthy, happy, prosperous week, Keep the Faith!