Is the United States sounding the stagflation alarm? Powell's speech sends dollar down

XM Foreign Exchange APP News - Deloitte survey data shows that 57% of Deloitte's annual survey released on Wednesday showed that as the holiday shopping season approaches, the majority of American consumers are pessimistic about the current economic situation. A survey of about 4,000 respondents conducted by the consulting agency showed that 57% of consumers surveyed expected the economy to weaken in the next year. By www.xmlone.orgparison, on the eve of last year's holiday season, only 30% of consumers expected the economy to weaken; in 2008, one of the representative years of the Great Recession, this proportion was 54%. This data marks that consumer expectations for the economy have dropped to the most pessimistic level since Deloitte started tracking this indicator in 1997. U.S. consumer resilience may be www.xmlone.orging to an end, according to Deloitte data. 77% of respondents expect prices of holiday goods to rise, up from 69% last year. The current holiday season is the first after former US President Donald Trump imposed the latest round of tariffs on a large number of imported goods. Brian McCarthy, head of retail strategy at Deloitte, said: "We have been discussing consumer resilience for some time - despite facing multiple pressures, American consumers have continued to consume and retail spending has continued to grow. But current expected trends indicate that this resilience may be www.xmlone.orging to an end." The pessimism of consumers across all income levels in the United States who plan to reduce spending has been transmitted to their holiday season spending plans. Deloitte's survey shows that due to anticipating rising prices in advance, consumers' average planned spending 1595 Gen Z consumers aged 18 to 28 in the survey said they planned to spend an average of 34% less during this holiday season than last year; Millennial respondents aged 29 to 44 expected to spend an average of 13% less during this holiday season.%. In contrast, Gen Xers plan to increase spending by an average of 3%, while Baby Boomers expect to spend an average of 6% less. McCarthy analyzed that for Generation Z consumers, the core reason for tightening holiday budgets is that they face higher uncertainty and instability in the early stages of their careers. He further explained: "This group is highly concerned about income levels and job market dynamics, and concerns about the economic situation will put greater pressure on them - because they have not had enough time to accumulate savings and have not prepared for the economic downturn." Mike Daher, Deloitte's head of the US consumer industry, added that in addition to rising prices for daily necessities such as groceries, Generation Z also "faces significant inflationary pressure related to housing costs." "Value for money" has become the core, non-gift expenditures have shrunk significantly, and gift expenditures have shrunk moderately. Deloitte's McCarthy emphasized that although various institutions have different expectations for the holiday season, "cost-effectiveness orientation" will become one of the core themes of this holiday season. Even in the past few months, Deloitte has observed a significant increase in the number of U.S. consumers reporting that they actively seek out deals. Deloitte's survey shows that regardless of income level, 70% of the respondents will engage in three or more "benefit-seeking behaviors", such as buying private label products or alternative ingredients, increasing the frequency of cooking at home, and purchasing second-hand cars. Given that consumers will be tight on their budgets, they told Deloitte that they will cut back on holiday-related non-essential spending. On average, consumers plan to reduce holiday non-gift spending (such as hosting parties, purchasing clothing and decorations, etc.) by 22%. However, the decline in gift spending has been relatively modest. Survey respondents said they plan to purchase an average of 8 gifts (compared to 9 in the same period last year) and spend an average of $536 on gifts (compared to $505 during last year’s holiday season). The key sales cycle is under pressure, and many institutions predict that holiday consumption growth will slow down. For retailers and brands, the above survey results sound a warning signal for the most critical sales cycle of the year. Other holiday spending forecasts also show that U.S. households are expected to scale back holiday spending, while still reflecting consumers' core needs to decorate their homes and give gifts during the holidays. Consulting firm Bain & www.xmlone.orgpany predicts that holiday sales in physical stores and online channels will increase by 4% year-on-year, below the 10-year average growth rate of 5.2%. Another report from Adobe Analytics shows that online holiday spending in the United States is expected to grow by 5.3% year-on-year, but this growth rate is lower than the 8.8% year-on-year growth rate in the same period last year. Consistent with the conclusions of Deloitte's survey, PwC's survey also shows that Generation Z consumers will reduce holiday spending. This group said they plan to reduce spending by 23% www.xmlone.orgpared with the same period last year. PwC data shows that overall, consumers are expected to spend about 5% less on holiday gifts, travel and entertainment than the same period last year, with the average total spending amounting to US$1,552. The National Retail Federation, a major U.S. industry trade organization, plans to release its holiday spending forecast report in early November. Powell's speech echoed the data survey, and the survey verification of the data also verified each other with Powell's speech.

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