While Americans pulled back on spending in April somewhat, it has not affected the auto industry and analysts do not expect the rest of the year to follow suit as consumers continue to spend.
Find out what market watchers and analysts see as the economic trend.
Americans pulled back on spending in April after splashing out earlier this year, raising the question of whether they will be able to power the economic recovery through a rough patch of government cuts and slower global growth.
The revival of the housing market has been all over the news in the past weeks but as MarketWatch’s Jim Jelter explains, there are three other areas of the economy that are doing better than you think.
Despite the soft April spending — which fell 0.2% from March, according to Commerce Department data Friday—the answer appears to be: yes, they can.
Mounting evidence suggests Americans are becoming more upbeat. Consumer confidence rose in May to the highest level in nearly six years, according to the Thomson Reuters/University of Michigan’s index of consumer sentiment, released Friday. Consumers stepped up their spending in the first three months of the year, while the nation’s retailers and auto companies have been reporting healthy demand.
Automotive Note: Robert Shuman, owner of a car dealership in Detroit, says sales of new cars this January doubled the previous year’s tally—and he has seen about 20% year-over-year gains every month since. His worry is having enough cars to sell—and finding new workers. He recently added four new salespeople.
“After more than five years of staying mostly on the sidelines, consumers are ready to unleash lots of pent-up demand,” said Bernard Baumohl, chief global economist at The Economic Outlook Group. “Simply put, consumers are now back in the driver’s seat steering this economy forward.”