Your Money
Inflation is melting away the value of household paychecks. Even so, household finances are as strong overall as they’ve been in decades, thanks to money saved during the pandemic, debt paid off over the past decade, and a strong job market.
More than two-thirds of U.S. economic activity is tied to household spending. Rising costs are changing the spending plans of some who had saved during the pandemic. Home purchases have been delayed, celebrations scaled back, and some luxury purchases scrapped altogether. Economists say the outlook for consumer spending depends heavily on whether the nation’s inflation fever recedes.
People really hate inflation, and consumer sentiment is deeply depressed. Still, how people say they feel doesn’t always align with what they’ll do.
People Have Money but Feel Glum—What Does That Mean for the Economy?
by Jon Hilsenrath
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